MIAMI – Avianca Holdings for the three months ending on September 20 has reported an operating loss of USD$156m.
For the same period last year, group company Avianca (AV), the flag carrier of Colombia, posted an operating profit of USD$28m. With AV ceasing operations in mid-March following the outbreak of the COVID-19 pandemic and South American flight restrictions, Avianca Holdings filed for Chapter 11 bankruptcy protection in the USA on May 10.
Having resumed operations in September, AV is now operating at 20% of capacity in comparison to November 2019, an improvement of the 12% of capacity in October.
A Path Forward, Albeit a Slow Path
Avianca Holdings also received approval form the US Bankruptcy Court for the Southern District of New York allowing accessibility to USD$2bn of debtor-in-position (DIP) financing.
Having already secured commitments, the DIP financing consists of a USD$1.27bn tranche A senior loan and a USD$722m tranche B subordinated loan.
In a November 12 US Securities and Exchange Commission filing, Avianca Holdings stated that “Avianca has the financial flexibility during this stage to support its operations and continue to make progress on its plan of reorganization without the participation of the Republic of Colombia”.
Avianca Holdings, making an albeit slow recovery, is set to move forward amid the COVID-19 pandemic, providing global and regional service around South America.
Featured image: Avianca El Salvador