SAA expects much smaller loss — but its forecast could be optimistic
SAA is projecting a net loss of R853m in 2017-18, a significant improvement on the projected loss of R4.5bn for 2016-17. However, its projections for the coming year might be optimistic — as the airline itself admits in its corporate plan tabled in Parliament Monday that it has failed to meet its budgeted revenue for the past three years. It fell short by 12% in 2014-15, by 4% in 2015-16 and by a projected 9% in 2016-17. According to the corporate plan, revenue of R34.4bn is forecast but operating costs of R29.7bn, aircraft lease costs of R2.9bn, finance costs of R1.7bn, and depreciation and amortisation of R692m translate into a forecast bottom-line loss of R853m. DA deputy finance spokesman Alf Lees said that while the loss of R853m might seem like a significant improvement on the 2016-17 projected loss of R4.5bn, it was not good enough. "The airline should at least be working towards break-even for the coming year," he said. He also believed the R853m loss could be an "optimistic...
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