The full extent of Monarch’s multi-million pound financial woes at the time of its collapse last month has been reported.
The company failed owing £466 million, the first creditors report from administrators KPMG reveals.
But there is just £600,000 available to repay unsecured creditors, with administrators concluding that the cost of repaying them would exceed this amount, the Sunday Times reported.
The carrier’s former owner, Greybull Capital, is likely to walk away with a loss, according to the report published late on Friday.
Monarch collapsed last month after terrorism and Brexit sent passenger numbers and profits plummeting.
Family investment fund Greybull was insulated from heavy losses by aircraft financing deals with Boeing.
As the main secured creditor, Greybull has first call on any assets. It is owed £157 million of secured debt, KPMG said, with the Pension Protection Fund owed £7.5 million.
KPMG said: “As the secured creditors will likely suffer a shortfall, there is no real prospect of a return to unsecured creditors in any of the administration companies.”
A report into Monarch Airlines reveals that it owed £466 million to unsecured creditors, ranging from would-be holidaymakers to aircraft leasing companies and the taxman. HMRC was owed £12.5 million and passengers £5.2 million.
Monarch Holidays owed a further £81 million to unsecured creditors, and a hotels website owed £22 million.
KPMG said it expects preferential creditors, Monarch’s employees, to receive 100% of the money owed to them, according to the Financial Times. A total of 1,858 staff at Monarch Airlines and Monarch Travel Group were made redundant.
The rest of the airline’s creditors are likely to get nothing, or just pennies in the pound.
KPMG last week won the right to sell some of Monarch’s lucrative take-off and landing slots to rival airlines, which are worth an estimated £60 million. Greybull is first in line to recoup the proceeds from the slots, as well as an engineering business.
But KPMG did not provide an estimation of how much money the slots could raise, or ascribe a value to the airline’s engineering business.
EasyJet, IAG, Wizz Air and Norwegian Air Shuttle have previously signalled their interest in buying Monarch’s slots.
At least one deal for the slots is expected to be announced early this week.
The slots at Gatwick have generated the most interest because of a lack of airport capacity during peak times.
The collapse led the government to launch the UK’s biggest peacetime repatriation, flying home more than 85,000 holidaymakers from overseas at a cost of £60 million.
Monarch is thought to owe money to 367,500 unsecured creditors, including £5.2 million in claims by passengers owed compensation, according to the report.