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Fastjet warns on financial future

African budget carrier Fastjet is in talks over its financial future after admitting that further funds will be needed by the end of February.

The carrier is in “active discussions” to dispose of its share in its operation in Zimbabwe to a consortium of investors.

The airline revealed in November that it was in discussions to sell the Zimbabwean arm for $8 million.

Fastjet said: “As previously announced the board expects further funding will be required by the end of February 2020 to enable the group to continue operating in its current form.

“The directors believe, based on current financial projections and funds available and expected to be made available, that the group will have sufficient resources to meet its operational needs until the end of March subject to forecast revenues not being impacted by any unforeseen circumstances.

“To address this funding requirement the group remains in active discussions with an investor consortium led and underwritten by Solenta Aviation Holdings Limited and other local investors in Zimbabwe, in relation to the disposal of the group’s holding in Fastjet Zimbabwe.

“The investor consortium is finalising its due diligence on Fastjet Zimbabwe and securing the required regulatory approvals.”

But the airline warned: “Whilst discussions with the investor consortium are ongoing there can be no guarantee of a successful outcome.

“If the group is unable to carry out the restructuring proposal by the end of March 2020 it would be unable to continue trading as a going concern.”

The airline said a further update will be made “in due course”.

Fastjet revealed that trading to the end of 2019 was in line with expectations

Revenue including Fastjet Zimbabwe is expected to be $42 million, up by $3 million on 2018 with an after tax loss of $7 million to $8 million, down from a loss of $65 million in the previous 12 months.

Fastjet suspended services in Mozambique in October.

 

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