SAS reports big Q4 pretax loss as pandemic slams air travel

STOCKHOLM: Airline SAS reported on Thursday a swing to a big loss in the August-October period as sales tumbled due to the COVID-19 pandemic.

Losses before tax in the company's fiscal fourth quarter totalled 3.27 billion Swedish crowns ($386.5 million) against a year-earlier profit of 1.10 billion, on a sales drop of 77%.

Compared with the May-July quarter, the loss deepened, from 2.07 billion crowns.

"Our view continues to be that the ramp-up phase for the airline industry will last until 2022 before demand can reach more normalized levels, with a return to pre-COVID-19 levels a few years thereafter," SAS, whose biggest owners are the governments of Sweden and Denmark, said.

The pandemic has brought airlines across the globe to their knees. SAS's close rival Norwegian Air Shuttle became the latest casualty when it filed for Irish bankruptcy protection this month.

In October, SAS secured a rescue plan that in total boosts its equity by 14 billion crowns, but dilutes shares by 95%.

Shares in SAS have fallen 61% this year as of Wednesday's close.

"The finalized recapitalization, followed by additional initiatives to manage liquidity, makes SAS prepared for a tough winter season and a challenging fiscal year 2021, that most likely will be loss making," SAS CEO Rickard Gustafson said.

SAS said it expects weak operating cash flow in the current quarter due to low demand during the winter season combined with accelerated refunds to customers.