Air Nostrum seeks €103 million from the fund for strategic companies

The company resorts to the SEPI to secure the resources needed to deal with the pandemic crisis and to maintain connectivity and protect employment

The delayed economic recovery due to the length of the pandemic has led the company to claim the temporary financial support

The company incurred a loss of €129 million in 2020 as a result of COVID-19, after six consecutive years of profit

From January to March, Air Nostrum has topped the list of companies with the most operations in the AENA network

In its commitment to recovering connectivity, the airline will resume 87% of its routes from two years ago in the middle weeks of summer

VALENCIA, APRIL 16, 2021

Air Nostrum has been forced to turn to the fund managed by the SEPI due to the length of the coronavirus crisis and its restrictions on passenger traffic, and given the forecast of a slower recovery than originally expected, in order to ensure its work integrating all territories and driving tourism.

This morning, the company submitted its request for access to the Solvency Support Fund for Strategic Companies (Fasee) to secure the resources needed to overcome the declining revenue after the sharp drop in passenger traffic caused by the pandemic, and to ensure connectivity and protect employment.

The company has estimated the amount it requires in the form of loans at €103 million, which the company plans to repay in 7 years.

In 2019, Air Nostrum marked its sixth consecutive year with profit, following the financial crisis from 2009 to 2013.

Last year, as a result of the pandemic, the company recorded losses of €129 million, pending approval at the next annual shareholder general meeting.

Throughout its almost 27 years of existence, its operational quality has been matched with financial profitability, thus reaching solvency and credit quality ratios that have enabled the signing of large fleet contracts and the construction of its own maintenance hangar.

At the end of the 2019 financial year, the company enjoyed a healthy equity and treasury position.

Since the beginning of the coronavirus crisis and in the face of the drastic reduction in air traffic demand, the company has maintained a policy of cash preservation and expenditure restraint; it has also reached agreements with fleet financiers, and last year it drew on ICO credit lines. Air Nostrum's workforce has been furloughed for over a year.

However, the limitations on mobility given the successive waves of contagion and the sharp decline in demand due to the impact of the crisis on domestic economies have slowed the pace of a progressive activity recovery, prompting the company to resort to government aid, in line with the support that other European airlines are receiving from their governments.

Strategic company

It should be noted that Air Nostrum is the most awarded European company in its regional aviation sector.

From January to March, Air Nostrum topped the ranking of the most active companies in the AENA network with 8,256 operations. It is also one of the airlines that has reduced the least operations compared to the first quarter of last year, 43.6% compared to the average of 71.6%.

The company, in its commitment to recovering connectivity, has resumed 62% of the routes it offered just before the impact of the pandemic last April; its schedule for the middle weeks of the summer is hoped to restart 87% of the routes that operated two years ago.

Thanks to its 75,507 flights and 5.2 million passengers in 2019, Air Nostrum can prove its strategic role because of its relevance to air links for much of the national territory.

The airline is present in virtually all of the Autonomous Communities and the Autonomous City of Melilla. It also fuels and distributes the Iberia Group's traffic at the T4 hub in Madrid. It is the first domestic route operator in Spain; it bridges niche markets, outermost communities, and routes under the scheme of Public Service Obligation in which it is the main tenderer; it is the only operator in the airports of Badajoz, Burgos, León and La Rioja, and also the only airline that offers air connectivi ty to the communities of Extremadura and La Rioja.

Air Nostrum has nearly 1,400 workers, generates more than 2,000 indirect jobs, and works with more than 900 suppliers.

It has its headquarters in Valencia, where it has become a centre for talent and technology in the sector and an economic driver of the Valencian Community. Based on its turnover and number of employees, it is one of the largest companies in the Community, both for its flight operations and its headquarters, and for the maintenance services provided for own and third-party aircraft.

Access to these funds will allow the company to continue its business plan and recover the path of profitable and sustainable growth held back by the pandemic.

Since 1994, Air Nostrum has transported more than 90 million passengers on two million flights. In 2019, the company had a turnover of €539 million.