Brazil airline Azul's cash generation surprises amid crisis

Azul Thursday said it managed to generate 1b reais ($186.32m) of cash between April and June, at the lowest point of the coronavirus crisis when carriers worldwide were burning through their liquidity. Cost cutting, including staff reductions, and unspecified investment gains were the primary causes. The carrier, which has cut 30% of its staff, is likely to be one of the only airlines in the world to have positive cash flow in Q2. Still, the extra cash may be temporary. In the first half of the year, Azul burned through 82m reais and expects to burn cash in the second half as well, at a rate of 3m reais per day. So far this year it has had a net loss of 9.3b reais, mostly due to the devaluation of the Brazilian real against the dollar. But Azul is now in a more comfortable cash position than its main rival in Brazil, Gol Linhas Aereas Inteligentes, which Reuters reported is facing a cash crunch as it nears a debt repayment deadline.<br/>