Airline SAS Q2 loss narrows, hopes to raise $1 bln in new cash

Airline SAS said it hopes to convert debt to equity and raise 9.5b Swedish crowns ($972m) in new cash, warning of liquidity problems if it falls short as it posted a quarterly loss that was narrower than a year ago. The carrier, part-owned by Sweden and Denmark, has been struggling for years and in February unveiled a major new restructuring plan that it said depended on raising then-unspecified new capital. "In addition to reducing the cost structure and improving efficiencies, SAS is seeking to convert approximately SE 20b of debt and hybrid notes into common equity and will also seek to raise not less than SE 9.5b in new equity capital," SAS said Tuesday. However, CEO Anko van der Werff told analysts on a call there had not been sufficient progress so far with the restructuring plans, and both governments declined to say whether they would pay up again after agreeing a 3b-crown rescue deal with the company in 2020. SAS said discussions with stakeholders overall had made "limited progress," and its shares were down 7% at 1015 GMT. "In the event that the expected burden sharing, debt conversions, and new capital raise are not completed as planned, SAS will not be able to support its existing capital structure and current liquidity levels," it said. SAS reported a February-April loss before tax of 1.56b crowns against a year-earlier 2.33b loss. The carrier was already struggling before the coronavirus pandemic amid high costs and increased competition. The aviation industry is now struggling to recover from COVID and SAS has reduced its summer programme by 4,000 of 75,000 planned flights.<br/>