SAA needs working capital of $ 540 million from next month

The short-haired South African public airline will need 7.5 billion rand ($ 540 million) as of next month to finance its daily operations until 2019, said Tuesday a presentation to a parliamentary committee of the airline.

SAA, which has not generated a profit since 2011, survives thanks to state guarantees and is regularly cited by credit rating agencies as a drain on public finances.

He has developed an austere recovery plan that includes cutting jobs and roads to make a profit by 2021 and convincing lenders to reinstate credit lines.

The airline said the lenders had refused to lend 3.5 billion rand to the company to fill a liquidity gap from December, unless the government undertakes new commitments, the presentation revealed. .

In addition, the national carrier will need 4 billion rand ($ 288 million) from March next year, the presentation revealed.

"Currently, we do not have an optimal capital structure and, therefore, we depend on the debt, which is not good … The banks are now insisting that the shareholder provide better support for the implementation Said Deon Fredericks, Acting CFO of SAA.

SAA is expected to record a loss of 5.2 billion rand during the 2019 financial year and 1.9 billion in 2020, before making a profit one year later, the presentation said.