Finnair develops ‘financial bazooka’ to survive crisis

Finnair has enough cash to survive until late 2021 with little or no flying, having introduced a raft of financial measures to ensure it can survive the coronavirus crisis, according to the carrier’s CE Topi Manner. “Our financial contingency measures have been quite sizeable and we have been developing a financial bazooka of sorts for ourselves, and that is why our cash position at this present time is still good,” Manner said. Despite the operator running at an operating loss of around E2m ($2.4m) per day – half of which is depreciation – “even if we would be flying very little, or nothing at all, well into the next year then our cash would be adequate until the latter part of 2021”, Manner states. Finnair has raised almost E1b of new debt since the crisis began – including via a government-guaranteed loan and through the sale-and-leaseback of one of its Airbus A350s – while it also carried out a rights issue that raised E500m of equity. At the same time, the Helsinki-based carrier has been minimising costs in other ways, and currently has around 80% of its staff furloughed, alongside plans for a permanent 1,000-job reduction from its pre-pandemic headcount of around 6,700 employees. “The permanent reduction of 1,000 people is directed to our land operations and headquarters operations,” Manner says, explaining that the cuts would be “something like 30%” of the pre-pandemic workforce serving those functions.<br/>