Air Nostrum (YW, Valencia Manises) has asked the Spanish state for a loan of EUR103 million euros (USD123 million), “to secure the resources needed to overcome declining revenues from the sharp drop in passenger traffic caused by the Covid-19 pandemic, and to ensure connectivity and protect employment,” it said in a statement.
It appealed for the “temporary financial support” from Spain’s industrial development fund (Sociedad Estatal de Participaciones Industriales - SEPI) after incurring a loss of EUR129 million (USD155 million) in 2020 following six consecutive years of profit. It offered to repay the proposed loan over seven years.
The airline was forced to turn to the fund “due to the prolonged coronavirus crisis and its restrictions on passenger traffic, and given the forecast of a slower recovery than originally expected,” it explained.
According to the statement, “at the end of the 2019 financial year, the company enjoyed a healthy equity and treasury position.” Since the onset of the crisis, Air Nostrum claimed it had maintained “a policy of cash preservation and expenditure restraint,” reached agreements with lessors, and last year it drew on credit lines from the Official Credit Institute (Instituto de Crédito Oficial - ICO), a state financing agency.
The carrier’s entire workforce of almost 1,400 people has been on the country’s furlough scheme (Expediente de Regulación de Empleo Temporal - ERTE) for over a year.
However, the ongoing travel restrictions and sluggish demand meant it had to resort to government aid, “in line with the support that other European airlines are receiving from their governments,” it said.
Air Nostrum said it had resumed 62% of the routes it offered before the impact of the pandemic, and by the peak of the summer it hopes to restart 87% of the routes it operated in summer 2019.
Air Nostrum continues to provides ACMI and charter services as well as scheduled flights under a franchise agreement with Iberia (IB, Madrid Barajas) as Iberia Express. More than half of its fleet is currently active, according to the ch-aviation fleets module, namely five of its eleven ATR72-600s, twenty-two of its twenty-six CRJ1000ERs, and three of its eight CRJ200ERs, but none of its four CRJ900ERs.
