South African Airways, the unprofitable airline owned by the government, is securing financing with maturities as long as seven years as it seeks to curtail losses and improve liquidity.
“Significant” achievements were made in a 90-day state-driven rescue plan that ended March 24, which was aimed at stabilizing the carrier’s finances, Finance Minister Nhlanhla Nene said in an e-mailed statement on Thursday. Savings “will begin to be realized during the 2015-2016 financial year,” he said.
SAA, Africa’s biggest airline by traffic, cut loss-making routes to Mumbai and Beijing and renegotiated supplier contracts to save money, even as it said in January it would probably report a loss for the 2015 fiscal year. The carrier, which was surviving off state credit guarantees, “renegotiated contracts with suppliers, which will result in significant savings in operational costs,” Nene said.
An interim board of four members was installed last year after a spate of resignations, and its term was extended by six months on March 28, Nene said.