Losses at South African Airways are set to widen to R4 billion ($292.86 million) in 2017\/18 – up from a previous estimate of R2.8 billion, according to Chief financial officer, Phumeza Nhantsi.<\/p>\n
Addressing parliament\u2019s finance committee on Wednesday,\u00a0Nhantsi said that the higher projected losses for 2017\/18 were related to the retirement of five leased narrow-body aircraft, which meant flights had been cancelled and planes grounded, reports Reuters<\/a><\/strong>.<\/p>\n Last week, SAA said even with a government injection of R10 billion, the struggling airline will remain under-capitalised with a negative equity position of over R9 billion. Vuyani Jarana, SAA\u2019s CEO, said the airline had outstanding debt of R13.8 billion($1.01 billion) as of this month and that it needed to pay back domestic lenders and U.S. bank Citi R4 billion by March 2018.<\/p>\n \u201cThe biggest challenge at SAA is the capital structure as well as the commercial strategy. If we are able to fix that we will be able to get SAA back on its feet,\u201d Jarana said.<\/p>\n Earlier in November,\u00a0Jarana confirmed that the airline was currently seeking an equity partner that\u2019s able to provide cash and operational savings.<\/p>\n One of SAA\u2019s main strengths is a 55% share of the South African market, which also includes contributions from low-cost carrier Mango and SA Express, Jarana said. A merger of the three airlines would help to secure a strong partner, he said, while also contributing to the cost-cutting plan.<\/p>\n \u201cSA Express is still being run as a separate entity by the government with a separate board,\u201d Jarana said. \u201cIt has a big strategic role to play.\u201d<\/p>\n
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