Japan Airlines confirms intention to raise 300 billion yen this month amid pandemic

Japan Airlines Co. said Thursday it plans to raise around 300 billion yen ($ 2.7 billion) in subordinated loans and hybrid finance to help it weather the prolonged impact of the COVID-19 pandemic. .

Details of the financing plan will be announced on Friday, the company said in a statement after news outlets previously reported on the plan citing sources.

“We are considering different ways of obtaining financing, in order to prepare for the long-term effects of the spread of coronavirus infections and in order to achieve the growth objectives set out in JAL’s medium-term business plan“, the airline said.

Last month, JAL recorded an operating loss of 82.65 billion yen in the first quarter – an improvement over the previous year – as cost reductions related to the pandemic took effect and the demand for travel has grown from a very low base.

Like other carriers, the company has depleted its cash reserves to retain the planes and workers it will need when travel demand rebounds.

JAL had raised around 180 billion yen last November through a takeover bid and other means to survive the pandemic and cover the costs of replacing its fleet.

The airline said last month it expected its cash consumption rate to fall to around 5 billion yen per month in the second quarter ending September 30, from 10 billion yen to 15 billion yen. yen per month in the first quarter.

Last year, rival ANA Holdings Inc. raised 419 billion yen in subordinated loans and 353 billion yen in equity to help it weather the pandemic and finance the purchase of new planes.

As Japan continues to see significantly lower numbers of international passengers amid tight border controls due to the spread of the highly contagious delta variant, the situation may gradually improve. Tokyo started issuing so-called vaccine passports to facilitate overseas travel from July.

On domestic travel, the government aims to lift restrictions from around November, provided people have been fully vaccinated or can provide negative test results.

In a time of both disinformation and too much information, quality journalism is more crucial than ever.
By subscribing you can help us tell the story well.



Source link