It seems SAA has no capital to run itself, says ANC MP Mnyamezeli Booi
SAA CEO Vuyani Jarana says SAA is not able to pay principal amounts, and is bearing interest, ‘which already indicates the debt is burdensome’
Worries about the going-concern status of South African Airways (SAA) were raised by members of Parliament’s standing committee on public accounts (Scopa), on Tuesday.This was an issue raised by the auditor-general regarding the 2016-17 financial statements and was only settled after the state made a cash injection of R10bn into the airline late in 2017.ANC MP Mnyamezeli Booi said it appeared that the airline had no capital to run itself.SAA CEO Vuyani Jarana noted in reply that the airline’s balance sheet was very weak, with a negative equity currently of R9.2bn. This debt would mature in March 2019, which presented a real challenge, he said."That is not the position that any business can run with where it has negative equity as we have today," Jarana told the committee. "Any business has a maximum debt carrying capacity. The moment you overburden a business with debt you get to a point where it is unable to carry its repayments whether it is interest or the principal amount."As th...
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