SAS AB Q4 Loss Widens, But Revenue Rises; Expects Approval For Chapter 11 Plan In Early 2024

SAS AB (SASDF.PK), a Swedish airline holding company, on Thursday registered a wider net loss for the fourth-quarter, amidst a significant depreciation of the Swedish Krona and an increase in jet fuel prices.

However, the company registered an increase in revenue supported by an improvement in demand.

For the three-month period to October, the company recorded net loss of SEK 1.928 billion or SEK 0.27 per share, compared with a loss of SEK 1.238 billion or SEK 0.17 per share, posted for the same period last year.

Pre-tax loss moved up to SEK 2.110 billion from previous year’s SEK 1.701 billion.

Operating loss surged to SEK 662 million from SEK 92 million a year ago.

Revenue passenger kilometers stood at 9.661 billion, higher than 8.240 billion in previous year.

Available seat kilometers increased to 12.417 billion from last year’s 10.684 billion.

The number of passengers flown was 6.787 million, up from 5.759 million a year ago.

Load factor increased to 77.8 percent from previous year’s 77.1 percent.

Personnel expenses rose to SEK 2.128 billion from last year’s SEK 1.879 billion.

Jet-fuel costs stood at SEK3.296 billion, higher than SEK 2.841 billion a year ago.

Other external expenses were at SEK 5.035 billion as against last year’s SEK 3.813 billion.

Revenue was SEK 12.019 billion, higher than SEK 10.651 billion in 2022.

The Group noted that it aims to receive approval of the Chapter 11 plan from the U.S. court in early 2024, to be followed by obtaining regulatory approvals and the implementation of a Swedish company reorganization at the SAS AB level, likely to be filed by SAS AB in 2024.

As a result, all of SAS AB’s shares and listed commercial hybrid bonds will be cancelled, redeemed, and delisted, which is expected in the second quarter of 2024. Consequently, there is no expected value for existing shareholders in SAS AB and only a modest recovery is expected for the holders of commercial hybrid bonds.

Further, the company anticipates its operations will remain unaffected by the legal proceedings to continue to serve its customers as normal.

Looking ahead, the Group said: “SAS announced financial projections on April 6, 2023, where SAS expected revenue to return to pre-Covid levels in fiscal year 2024 and income before tax (EBT)1 to be positive. SAS is currently reviewing the financial projections, as part of the preparations for completing the Chapter 11 process.”

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