Air Berlin (1991) (Berlin Tegel) published its annual report this week, revealing a loan from major shareholder Etihad Airways (EY, Abu Dhabi International) for EUR350 million (USD382.5 million). The Abu Dhabi-based carrier now has an exposure to Air Berlin of almost EUR2 billion (USD2.19 billion), reports Bloomberg.
Air Berlin's annual report states that on April 28, 2017, Etihad granted the loan facility to the German carrier until December 31, 2021. Etihad additionally committed to providing support for Air Berlin's financial obligations for 18 months from April 28, 2017.
Abu Dhabi Commercial Bank and the National Bank of Abu Dhabi extended their loans – AED726 million (USD198 million) and EUR75 million (USD82 million) respectively – until April 2019.
As previously reported, Air Berlin will also transfer its 49.8% ownership of Austrian production company Niki (Austria) (Vienna) to Etihad in exchange for EUR300 million (USD328 million), pending regulatory approval.
The report shows that Air Berlin's financial performance was negative across the board. Revenue was down on 2015 by 7.3%, revenue per ASK declined 4.7% while cost per ASK increased 2.3%. Share prices registered a decline from EUR0.92 at end-2015 to EUR0.61 at end-2016.
At the close of 2016, Air Berlin was left with operating losses of EUR667 million (USD730 million), more than double 2015's losses. Its net debt now stands at EUR1.18 billion (USD1.3 billion).
However, Etihad CEO James Hogan appears optimistic. "We are seeing the first structural changes that are necessary to create a sustainable future for Air Berlin," he said in a statement.
