Still no economic visibility for Air Mauritius

At this stage, “it remains difficult to estimate the restructuring costs (given the stage of the discussions with the stakeholders), which need to be included in the financial statements for the year ended 31 March 2020 and the subsequent quarterly results that comply with the fundamental accounting principles”. 

The subsequent events may affect the preparation of the Accounts on a going concern basis. According to Administrators, “further time is therefore required to be able to include information in the financial statements in order to provide a true and fair view of the financial status of the Company”. 

For the same reasons, there may be delays to publish the quarterly financial statements for the quarter ended 30 June 2020, 30 September 2020 and 31 December 2020.

Accordingly, the company has obtained the formal approval of the Stock Exchange of Mauritius Ltd (“SEM”) for an extension of publishing its abridged consolidated audited financial statements, for the year ended 31 March 2020 and its subsequent quarterly results, up to 30 June 2021.

Air Mauritius entered voluntary administration following a total collapse in revenues due to the COVID-19 crisis in April. The airline announced this dramatic measure following a board meeting which met on June 22 to consider the latest financial status. Sattar Hajee Abdoula and Arvindsingh K. Gokhool of Grant Thornton were appointed as administrators of the company.

According to several sources, Air Mauritius expects to report a loss of MUR 9.5 billion Mauritian rupees (USD 238 million) for the current financial year, ending March 2021. Last June the government had announced that MUR7-9 billion (USD175-225 million) have been earmarked in the fiscal year 2020/21 to keep the company afloat.

Borders were reopened on October 1, 2020, to Mauritian nationals, residents and to tourists travelling for long stays. Upon arrival in Mauritius, a 14-day in-room quarantine is mandatory. A negative PCR test administered not more than 7 days prior the date of boarding is also required by local authorities.

Airports Council International (ACI) World and the International Air Transport Association (IATA) have made a joint call for a globally-consistent approach to testing international passengers as an alternative to quarantine measures.

The global shut down of air transport as a result of COVID-19 travel restrictions has had a catastrophic impact on employment. Some 4.8 million industry jobs have been lost or are under threat. IATA has drawn pessimistic scenario based on a slower opening of economies and relaxation of travel restrictions, with lockdowns extending into Q3, possibly due to a second wave of the virus which would further delay the recovery of air travel.

In this case, global RPKs in 2021 could be 34% lower than 2019 levels and 41% below our previous forecast for 2021. ACI World and IATA are urging governments to cooperate and to remove quarantine restrictions and restart air travel.