Net losses at Colombia’s Avianca up 22% in 2020

RIO DE JANEIRO, BRAZIL – Net losses at airline Avianca Holdings increased 22% to US$1.09 billion in 2020 due to the near-paralysis of global air travel because of COVID-19, the company said on Monday, March 29th.

The airline, which is carrying out a restructuring process under the U.S. Chapter 11 bankruptcy law, had losses of US$894 million in 2019.

Operations contracted 74% year-on-year, the airline said in a filing to Colombia’s financial regulator, while operating income was down to $1.71 billion, from US$4.62 billion in 2019.

Keeping passenger planes grounded due to coronavirus meant Avianca reduced its costs to US$2.3 billion in 2020 from US$5.17 billion the year before, the statement said.

Passenger numbers fell 74% to 7.9 million, the company said, and 33% of income was provided by US$556 million in earnings from its cargo business.

In October, a U.S. bankruptcy court approved a proposed financing plan of over $2 billion to help the carrier exit Chapter 11 restructuring.

The company had US$911 million in cash at the close of last year and a still-available financing commitment of US$350 million.

“This reflects our solid liquidity, after successfully acquiring about US$2 billion in Debtor-in-Possession – DIP – financing last year, including more than US$1.2 billion in new resources, all of which is private capital,” Avianca said.

Colombia’s flagship airline has a fleet of 158 planes and 19,000 employees.