Acsa’s annus horribilis as FY loss hits R2.6bn

Airports Company South Africa (Acsa) – the state monopoly that controls nine of the country’s main airports – reported a loss of R2.6 billion on Tuesday for its financial year ended 31 March 2021 as the Covid-19 pandemic wreaked havoc for the aviation industry globally.

This represents the worst financial performance in Acsa’s 28-year history, group CFO Siphamandla Mthethwa confirmed during a results presentation.

However, Mthethwa stressed that this came in the context of the “devastating impact” of the Covid-19 financial fallout “on the aviation sector globally”.

He said the sector has seen losses of around $125 billion worldwide.

Acsa has historically reported annual profits and has been one of the better operated state-owned enterprises.

“The R2.6 billion loss for FY2021 is the group’s second ever loss… But Acsa was is a strong financial position before Covid-19, which enabled us to go into the pandemic with a stronger balance sheet,” Mthethwa pointed out.

“As we sit here today, we are in a much stronger position as the aviation sector recovers,” he said, adding that Acsa had taken “decisive action” to boost its liquidity to weather the Covid storm.

Some of the measures included cutting back on capital and operating expenditure, raising R2.3 billion via a state-backed preference share debt instrument, and the sale of its stake in India’s Mumbai International Airport.

Acsa saw passenger numbers for the year to the end of March 2021 plunging to just 4.6 million, compared to around 21 million passengers in the prior financial year or pre-Covid.

This resulted in the group’s revenue plummeting from R7.1 billion in its financial year ending March 2020, to R2.2 billion for its 2021 financial year.

Worth noting is that its 2021 financial year is made up of much of last year, when Covid-19 hard lockdowns and travel restrictions hit the start of its first half in April.

Mthethwa said he believed that “the worst is over” related to the Covid-19 financial fallout.

He reiterated that Acsa’s balance sheet remains strong and the group continues as a going concern, with R32 billion in assets, despite posting an operating loss last year due to Covid-19.

Acsa CEO Mpumi Mpofu said despite the devastating impact of the pandemic, the group moved swiftly to deal with the situation.

She said while international air traffic into SA will take longer to recover to pre-Covid levels, domestic air travel was seeing a more robust recovery.