Air Europa is considering asking for another public rescue to save it from the impact of Covid-19. and works with a target amount of 150 million euros. The airline indicates in its 2020 annual accounts the need for this life preserver that complements those it has already received in recent months and that allows it to stay afloat. All of this was being prepared, while the number of managers shot up, going from 16 in 2019 to 29 in 2020 and reducing its workforce by 30%.
According to the sources consulted, the new request would be around 150 million euros. This figure should be added to the 475 million it received in November 2020 from the rescue fund for strategic companies managed by the Sociedad Estatal de Participaciones Industriales (Sepi) and the 140 million euros it obtained from banks, backed by 70% by the Official Credit Institute . That is, only with the amounts derived from the situation caused by Covid-19, Air Europa would have increased its debt by 765 million euros with tight maturity terms.
Specifically, the aid approved by Sepi – which is divided into two loans, a participative one of 240 million and another ordinary of 235 – has a term to repay it until 2026 . In the case of bank financing guaranteed by the ICO, the maturity period extends until 2025, although they achieved a grace period of one year.
How to meet those deadlines? The accounts seem complicated. In the best year of the company, 2019, the profit was 27.7 million euros. In a theoretical exercise in which every year was like this and the entire profit was dedicated to paying the debt, the airline would take more than 28 years to be able to return this money .
Nothing could be further from the truth. The Covid turned the aviation sector upside down and the 2019 numbers will take time to see again. In 2020, Air Europa invoiced 40% of a normal year and in 2021 the numbers do not look much better. To this day, the airline still operates less than half of the flights from before the pandemic and the recovery of long-haul connections will still have to wait. The best forecasts for the sector predict a relative “return to normality” from 2024 , although a complete recovery is estimated for 2026. The record figures achieved in 2019 therefore seem difficult to achieve in the short-medium term.
This situation occurs in the middle of Iberia’s purchase of the company , which was finally closed at 500 million euros . This move has yet to be approved by the Competition authorities of the European Union that can establish conditions on the acquisition.
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