Tuesday, September 10, 2013

■ SOUTH AFRICA: SAA's Turnaround Plan to undergo parliamentary committee scrunity this week.

SAA logoMonwabisi Kalawe, South African Airways' (SA) Chief Executive Officer, says the airline's strategic turnaround plan #9 will be presented to a South African parliamentary inquest committee this week ahead of a possible release to the public at the airline's AGM tentatively due later this month.

SAA's Airways Park, Johannesburg
SAA's Airways Park, Johannesburg
In an interview with BusinessDay, Mr Kalwe expressed faith in the Plan, stating that both his board and the South African Department of Public Enterprises, the governmental portfolio tasked with overseeing the state's aviation assets, had been working "very closely" for the last three months in a bid to correct the struggling airline's balance sheet. With the airline having posted an operating loss of USD163.2million (ZAR1.3billion) for its last financial year, Mr Kalawe said the Plan would require a "large recapitalization of the business".

While exact details of the Plan are still scant, he alluded to the termination of certain loss-making routes and noted that Africa, freight in particular, presented a strong opportunity for growth, in line with Minister of Public Enterprises, Malusi Gigaba's previous directives.

An announcement regarding the airline's planned long-haul fleet renewal strategy is also expected.

In October last year, Pretoria stated it would guarantee USD600 million in loans to the troubled state airline over the next two years.