Air Europa would take greater than 20 years to return public support with its final advantages

The airline earned 27.7 million euros in 2019 however admits that the pandemic could have unpredictable destructive penalties

Air Europa registered a web revenue of 27.7 million euros in 2019, 43.2% lower than that obtained within the earlier yr, through which it achieved a constructive results of 48.8 million euros, in keeping with the accounts deposited within the Mercantile Registry. Probably the most worrying information in these accounts is just not the lower in revenue however the truth that, with these outcomes, the airline owned by the Hidalgo household shall be unable to return the general public support it has acquired for greater than 600 million in a most interval of six years established by the rescue fund.

The Authorities authorized final November the injection of 475 million euros of public cash into Air Europa on account of the brand new solvency fund aimed toward supporting strategic firms which have been impacted by the covid-19 pandemic. Beforehand, final Might Air Europa had obtained a mortgage of 140 million euros endorsed by the Official Credit score Institute (ICO). In these methods, with the extent of advantages reached in 2019, and with out making an allowance for the pandemic, the corporate would take greater than 20 years to return these support.

The state of affairs is much from regular in 2019. The restoration of pre-pandemic air site visitors ranges is just not anticipated till 2023 or 2024, so it’s tough for the airline to earn cash once more till then. In 2020 alone, losses are anticipated to skyrocket to 600 million euros. With these figures, Air Europa wants exterior assist: both the State converts the loans into fairness upon maturity and turns into a shareholder of the corporate, or IAG assumes that debt if it lastly completes the acquisition of the airline agreed in November 2019 for 1,000 million euros, however which is renegotiating downwards for the reason that outbreak of the pandemic.

The Hidalgo household is the only shareholder of the airline by means of the Air Europa Holding firm. A standing that may seriously change if it can’t face the compensation of the help, for the reason that State would turn into the primary shareholder of the corporate, a state of affairs that already happens in different European airways akin to Lufthansa, Air France-KLM or Alitalia rescued by their respective States. The opposite chance is that IAG assumes the debt and agrees to purchase and promote Air Europa with cost in shares as an alternative of money as acknowledged within the unique settlement. Additionally on this case, the Iberia dad or mum firm could be the principle and even the one shareholder of the corporate.

The coronavirus disaster has damaged all of the expectations of the second Spanish airline. In 2019, its earnings reached 2,340 million euros, 10.7% greater than within the earlier yr. The best progress in income (+ 14%) got here from flights to America, the principle market, which billed 1,458.8 million euros, in comparison with 504 million for home flights or gross sales of 368 million for flights with the European Union. Exactly this market construction additionally makes the airline extra uncovered to the disaster, for the reason that routes most affected by the restrictive mobility measures are these of lengthy haul.

Working revenue fell 11.8% to 82.9 million euros. The variety of passengers transported reached 13.13 million, 1.3 million greater than in 2018, with an occupancy charge of 83.6% in 2019, similar to that of the earlier yr.

Though the accounts correspond to 2019, the airline has had time to incorporate within the annual report a primary steadiness of the consequences of the pandemic whose future penalties it admits that it’s at present unable to evaluate. Thus, it states that the web quantity of turnover for the primary 5 months of the yr has been decreased by 42.6% in comparison with the earlier yr “and is considerably under the budgeted quantities”. And, along with the credit assured by the ICO, the airline signifies that it’s renegotiating sure money owed with suppliers on which deferrals have been obtained for a complete quantity of 31.6 million euros.

Concerning personnel, it stories on the applying of the short-term employment regulation file for 91.9% of the workforce, which represents 76.7% of the full hours. The common workforce reached 3,490 staff on the finish of 2019, of which 600 are pilots and 1,747 flight attendants.


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