SAA needs R12.5bn in funding to stay afloat, Parly committee told
SAA told Parliament’s Standing Committee on Finance that its going concern status is still under threat.
CAPE TOWN – South African Airways (SAA) says it will need at least R12.5 billion in funding over the next three years if it is to continue operating.
It’s told Parliament’s Standing Committee on Finance its going concern status is still under threat. Without more funding, whether from the public purse or a strategic equity partner, it won’t be able to submit financial statements in time.
The airline has made a R5.7 billion loss in 2017/18 financial year, double what was expected.
SAA board chairperson Johannes Magwaza says that liquidity problems remain the airline’s greatest challenge.
An oversight committee chaired by deputy Finance Minister Mondli Gungubele has met six times to discuss the cash flow problems.
Chief executive Vuyani Jarana says despite the airline's woeful performance in the last quarter, it remains committed to its target of breaking even in 2021.
"We've put a plan in place and presented it to the shareholder and said: 'Here is the plan and these are the options. If you trust the plan, we must understand that it will need funding.'"
He says the longer the funding issue drags on, the greater the already negative impact on the airline’s position in the market.
(Edited by Shimoney Regter)