No Air Malta accounts two years in a row

Air Malta’s accounts will only be published after the European Commission gives its verdict on government’s application for state aid, Finance Minister Clyde Caruana said.

Air Malta’s financial year ends in March but the government-owned company did not publish its accounts last year for the period that preceded the COVID-19 pandemic.

Caruana told MaltaToday that the airline’s accounts “are ready” but will not be published as yet.

“We are presenting the accounts to the European Commission as part of our application to get the green light for state aid injection,” he said, adding that all the information will be released after the Commission’s verdict.

Caruana would not quantify the size of the state aid package but in the past, he has said it will run into “tens of millions”.

Like other airlines, Air Malta took a battering last year as a result of travel restrictions to curb the spread of the pandemic.

However, it is understood that the airline had already been making losses in the preceding year.

Last month, Caruana told sister newspaper Illum that Air Malta was making operational losses to the tune of €170,000 per day as a result of the pandemic. He said that without state aid injection, the airline will not survive.

Air Malta had to make most of its pilot staff redundant last year.

The company had benefited from a state aid injection of €200 million back in 2012, and further capital injections from strategic asset sales to the government in 2018.

In February 2020, MaltaToday had revealed that Air Malta’s journey to sustainable finances had once again been hampered by a year in which operational losses had climbed to €30 million.

But that was the figure right before the COVID-19 pandemic shut down the international travel industry, grounding all airplanes, and contributing to well over €100 million in losses for the beleaguered airline.

While in 2017, the company reported operating losses of €10.8 million, the airline registered a small €1.2 million profit, prior to restructuring costs. But this was down to clever book entries that allow the Maltese government to inject more cash in the airline.

Under state aid rules, Air Malta can no longer use taxpayers’ cash after the €200 million restructuring programme of 2012.

So in 2018, the airline revalued its properties upwards, obtaining a €16 million boost to pad €223 million in accumulated losses from previous years.

The real money-spinner for Air Malta were the millions paid by the Maltese government to buy the airline’s landing rights at London Heathrow and Gatwick airports. To do this, the government created a company to acquire the slots and then lease them back to the airline. Those landing rights were given a speculative value of €33.8 million just for the summer alone. The same was expected to happen in the financial year ending March 2019, where the winter slots would be valued at €22.8 million.