Malaysia Airlines Berhad (MAB) said in a statement last Friday it had "reached out to its lessors, creditors and key suppliers recently" as it worked through an urgent restructuring exercise.Read More » The statement was released after the Reuters news agency reported MAB's parent company, Malaysia Airlines Group, told lessors in a letter it might not be able to make repayments beyond November if it failed to receive more funding. MAB's sole shareholder is Malaysia's sovereign wealth fund, Khazanah Nasional Berhad.
MAB’s statement did not address the contents of the letter as reported by Reuters, but said the restructuring plan was "highly dependent on the individual contributions of all relevant stakeholders in supporting the group to emerge from this crisis as a well-capitalised and financially healthy airline group". It added it hoped to complete the restructuring exercise in the next few months. "However, if such an outcome is not possible, the group will have no choice but to take more drastic measures," MAB said.
The International Air Transport Association (IATA) said last week it was reducing staff numbers by about 22%, representing about 400 positions globally, as part of an organisational restructuring. The airline lobby group said half of the job cuts had been accounted for through existing unfilled positions and voluntary departures. "The restructuring will ensure IATA is well-positioned to sustainably support its members as we work towards restarting the aviation industry," IATA said in a statement.
Singapore's Changi Airport Group (CAG) reported late last week net profit for the 12 months to March 31, 2020 fell 36%, to S$435 million (US$319 million), from S$677 million 12 months ago. Revenue rose 3% to S$3.12 billion, CAG said. While Changi was buoyed by strong travel demand and the opening of the Jewel entertainment and retail complex, the airport said travel restrictions and border controls from the coronavirus pandemic led to a collapse in air travel in the last two months of the financial year. CAG said in its annual report the longer-term outlook was uncertain at this point and COVID-19 would have a significant bearing on its fiscal 2021 performance. "The operating results of the group are expected to be materially and adversely impacted for the year ending March 31, 2021," CAG said.
New Zealand residents who have not been in a COVID-19 hotspot – defined as an area with a three-day rolling average of three locally acquired cases per day – will be able to travel to parts of Australia from October 16 without quarantining on arrival under a safe travel zone arrangement announced late last week. It was, for now, a one-way arrangement, with Australians not permitted to enter New Zealand. Also, New Zealanders returning from Australia would have to undergo 14 days of quarantine.
The government also has announced overseas-based air crews will be required to spend their layovers in a government-managed isolation facility, usually a hotel, for as long as they were in the country to "ensure they avoid contact with New Zealanders". Crew must wear personal protective equipment at the airport and when travelling between the airport and their hotels. The rules also have changed for New Zealand-based crews returning from "high-risk locations". They now have to spend at least 48 hours in self-isolation, or until they are assessed as low risk and produced a negative test result for COVID-19. The government is introducing weekly surveillance testing for some lower-risk New Zealand-based international air crew from October 19.
Rolls-Royce announced late last week a £2 billion (US$2.6 billion) capital raising to improve liquidity and strengthen its balance sheet. The fully underwritten share issue, with eligible shareholders able to buy 10 shares for every three they own, was priced at a 32 pence a share, representing a 41.4% discount to last Friday's closing share price of 130 pence. In addition to the rights issue, the engine maker said it was conducting a sale of corporate bonds to raise another £1 billion, setting up loan facilities and securing an extension of the U.K. Export Finance's 80% guarantee of its existing £2 billion five-year term loan. "These steps will provide the group with improved financial resilience and a more appropriate balance sheet structure in order to weather macro-economic risks before we return to strong cash generation, expected in 2022," Rolls-Royce said in a statement.
China Development Bank Financial Leasing Company (CDB) said on Friday its aviation leasing arm, CDB Aviation Lease Finance DAC, had signed a purchase-and-leaseback agreement with Wizz Air Hungary for six A321neos. The aircraft will be delivered by the first quarter of calendar 2022, CDB said in a regulatory filing to the Stock Exchange of Hong Kong.
Fiji Airways has announced it will operate two freighter services between Nadi and Singapore this month. The return flights, to be flown by A330s, are scheduled for October 7-8 and 21-22. Passenger flights have been suspended since March and will not resume until the beginning of November, the Fiji Airways website said.
The airline has scheduled a 90-minute scenic flight aboard an A350-900 on October 10 to celebrate the country's 50th Independence Day anniversary and raise money for the Fiji Cancer Society. Thirty business class and thirty economy class tickets will be sold for the flight, the airline said. The South Pacific airline is the latest carrier to sell "flights to nowhere", a trend proving popular across the region.
