Sydney Airport plans to raise A$2b to battle virus hit after H1 loss
[SYDNEY] Sydney Airport Holdings said on Tuesday it would raise A$2 billion (S$1.96 billion) of equity to lower its debt levels after swinging to a half-year loss, as the Covid-19 pandemic continues to hammer travel.
In May, the operator of Australia's biggest airport said it did not foresee the need to raise equity, but that was before Covid-19 cases surged in the city of Melbourne, prompting border closures between states and further hurting travel and business.
"The outlook is very uncertain," chief executive officer Geoff Culbert told analysts after the airport reported a net loss of A$53.6 million for the six months ended June 30, compared with a profit of A$17.3 million last year.
"What we are witnessing today is the most stringent restrictions on the movement of people since the second world war, and in the domestic context possibly the most stringent movement restrictions in Australia's history," Mr Culbert said.
Domestic passenger numbers in August so far are down 94.2 per cent from a year ago, worse than the 88.2 per cent fall in July due to additional state border closures, while international traffic in August to date is down 96.8 per cent, Sydney Airport said.
Freight-only flights represent 70 per cent of take-offs and landings, compared to 2 per cent before the pandemic, Mr Culbert said.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
A staff job guarantee for its 500 employees will not be extended beyond Sept 30 and a review is underway that could result in job losses, he added.
Sydney Airport said its net debt position would reduce from A$9.1 billion to A$7.1 billion as at June 30 after the fund raising and it did not expect to pay a shareholder distribution in 2020.
"We think this provides ample liquidity to remove doubts on liquidity even in an uncertain recovery," RBC Capital Markets analyst James Nevin said in a note.
REUTERS
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Transport & Logistics
XPeng CEO says its software, AI upgrades to enter ‘super fast cycle’
Swedish manufacturer is latest to offer electric pleasure craft in Singapore
Mercedes says it will continue to invest in China tie-ups
Xiaomi locks in over 75,000 orders for SU7 car, targets over 10,000 deliveries in June
Ford profit beats on commercial sales; EVs still dragging
GM CEO Barra compensation fell 4% in 2023 to US$27.8 million