It was revealed in Parliament last week that South African Airways (SAA) has projected losses for the 2016/17 year of R 3,5 billion.
This represents a staggering R 2 billion increase compared with the R 1,5 billion loss declared in the 2015/16 year.
There is no doubt that these massive losses will mean that SAA will once again run out of cash and will have to pull out the begging bowl to get another government guarantee hand-out.
It is greatly concerning that this is R 1,8 billion more than the R 1,7 billion loss that was projected a mere four months ago.
The new board of SAA has clearly not been able to turn SAA around or even just stem the massive losses. The board is hamstrung by the apparently poor and incompetent leadership of its chair Dudu Myeni.
SAA can only be saved if put under immediate business rescue and action taken to achieve a private equity deal that would result in capital revenue for the shareholder and thus the taxpayer.
The Democratic Alliance has requested that SAA produces a cash flow analysis for the 12 months of the current 2017/18 financial year. This will enable the full extent of the bankruptcy of SAA to be seen.
“The DA is even more convinced that the only way to stop the monumental losses is to put the airline into business rescue and we will therefore make every effort to ensure that the Minister of Finance takes action to achieve this,” said Alf Lees, the DA Shadow Deputy Minister of Finance.