SAS has secured further financial support from the governments of Denmark and Sweden, and from shareholders, to boost the airline’s liquidity to allow it to ride out the fall in demand for air travel. SAS now has access to a SEK 3bn (approx. US$362 million) credit line, structured pursuant to the EU’s rules for state aid, which designed to create a liquidity buffer and is to be seen as a complement to other ongoing activities at SAS to reduce costs and strengthen liquidity.
SAS has reported a continuing fall in revenue for the second quarter, February – April 2021 for the airline. Revenue by 63% to SEK 1,932 million, with a net loss of SEK 2,433 million – which is an improvement over the SEK 3,714 million loss posted for the 2020 second quarter.
Currency-adjusted passenger revenue decreased 80%. The decrease was a result of lower scheduled capacity (ASK) which, based on the preceding year’s circumstances, had a negative impact on revenue of SEK 6,403 million. The lower load factor had a negative effect of SEK 2,385 million. The higher yield had a positive impact of SEK 572 million on passenger revenue.
Currency-adjusted cargo revenue increased SEK 16 million and currency-adjusted charter revenue was SEK 416 million lower. Other traffic revenue (currency-adjusted) was SEK 542 million lower.
During the reporting period, Anko van der Werff was appointed President and CEO. Karl Sandlund was appointed Chief Commercial Officer at SAS, as acting President and CEO.
SAS confirmed that it had secured financing for the majority of its aircraft deliveries until the second quarter of 2022.
“New coronavirus cases remained high during the quarter, resulting in strict travel restrictions and low demand for flights. Focus for the quarter has been on lowering SAS’ costs, preserving liquidity and further strengthening SAS’ future competitiveness. The increase in vaccination rates provides some hope for the relaxation of restrictions, and an increase in demand ahead of the important summer season,” commented Karl Sandlund, Acting President and CEO. “Even if the number of people vaccinated is growing globally, high numbers of new cases and strict travel restrictions continue to impact society and slow recovery for the airline industry. Demand remained low during the second quarter and the number of passengers fell 2.4 million year-on-year, and was down 140,000 on the previous quarter.”
The continuing weak demand, says SAS, has made it necessary to “continue to adapt operations and reduce costs to offset the substantial loss of revenue” said Sandlund, which has kept costs down 54% for the quarter to SEK 4.6 billion.
SAS is prioritising liquidity and cash at the end of the quarter amounted to SEK 4.4 billion.