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SAA soars to losses of R 5.6 billion

SAA’s losses for the 2014/15 financial year was R5.6bn — close to R1bn more than the expected amount of R4.7bn.

This emerged when the national carrier presented its 2014 to 2015 interim financial statements to parliament’s standing committee on finance on Tuesday.

The national airline made a R 1.5 billion loss in the 2015/16 financial year.

On the day when the airline submitted these financial statements – a year overdue and more than 18 months after the end of the previous financial year – the report didn’t contain the auditor’s report and could still be subject to changes.

Two matters that were expected to have a significant effect on the financial statements are the anti-competitive claims lodged by Nationwide and Comair airlines that are likely to cost SAA more than R1.1bn in penalties.

Originally, the airline didn’t make provision for these penalties.

The courts ruled in favour of Nationwide who received a damages claim of R104.4m.

In the Comair case against SAA the airline put forward a damage claim totalling R898m, but it also asked the court to add 15.5% interest, which could increase the total in damages to R2bn.

In both cases SAA is sued for entering into agreements with travel agents from 2001 to 2005, whereby it paid them to divert customers to SAA rather than other airlines.

The Democratic Alliance called for a number of reports that have still not been presented to the committee.

“We expect that the committee will be furnished with final and complete reports for both the 2014/15 and 2015/16 years both of which are now overdue for tabling,” said Alf Lees of the DA.

These reports include;

  • The finalised annual reports for SAA and all subsidiaries.
  • The audited annual financial statements for SAA and all subsidiaries.
  • The auditors statement.
  • The SAA Shareholder Compact.
  • The evaluation of the Boards conduct and performance by Stator (Pty) Ltd
  • The “benchmarking” exercises referred to in the preliminary annual report

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