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File photo: Lusa
Mozambique Airlines (LAM) has reduced its debt by 61.6 million US dollars (€57 million) since April and continues to recover, Fly Modern Ark (FMA), the South African entity responsible for the carrier’s revitalisation strategy, said on Tuesday.
“With regard to debt restructuring, at the moment, after three months, we have managed to reduce the debt by $61.6 million dollars (€57 million),” said Sérgio Matos, the FMA representative, at a press conference in Maputo.
When Fly Modern Ark took over management of the state-owned airline in April, LAM had an estimated debt of around $300 million (€277.7 million), according to figures provided at the time.
Sérgio Matos said that the decrease in creditor charges was the result of “correct entries of transactions in accordance with international accounting standards, generally acceptable accounting practices and the accounting guidelines of the national treasury”.
It is also due to the offsetting of debts against debtors, totalling $23 million (€21.2 million), added Matos.
The manager revealed that LAM is in negotiations with the manufacturer Boeing for the reimbursement of $23 million resulting from the pre-payment of a new aircraft that was never delivered to the Mozambican carrier.
In the last three months, LAM recorded a 24% increase in the number of passengers carried, to more than 56,000, and increased flight revenue by 10%, to 671 million meticais (almost €10 million).
The increase was due to a rise from seven to 10 aircraft at the company’s service and a 30% reduction in ticket prices on six of the nine domestic routes it operates, he continued.
The number of flights also grew from 911 in March, a month before the current management took office, to 1,047 in July, an increase of 15% in three months.
The three new international routes and inter-provincial routes also contributed to the positive performance achieved since April.
Although LAM has emerged from insolvency, the carrier needs more aircraft to ensure an operation that allows it to pay off its high debt and generate profits, noted the manager.
Fly Modern Ark says that it has managed to get LAM to fulfil its fleet maintenance requirements imposed by international regulations and contain the costs inherent in this service.
In recent years, the flag carrier had faced operational problems related to a reduced fleet and lack of investment, with the recording of some non-fatal incidents, associated by specialists with inefficient maintenance of aircraft.
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