Azul is not planning on filing for Chapter 11 bankruptcy protection, the Brazilian airline's CEO told Reuters, contradicting reports which caused the carrier's shares to nosedive on Thursday. Bloomberg reported on Wednesday Azul was considering options ranging from an equity offering to filing for Chapter 11 in the United States in order to address its debt obligations. The report was "misinterpreted," the company responded in a filing, as its Brazil-listed shares sank 24%. CEO John Rodgerson said in an interview that Azul was financially healthy and in "friendly negotiations" with its partners, including aircraft lessors, due to the depreciation of Brazil's real. The real has weakened around 14% against the U.S. dollar so far this year. A number of Latin American airlines have undergone Chapter 11 bankruptcy proceedings after the COVID-19 pandemic disrupted travel, including Aeromexico, LATAM Airlines and most recently Azul's direct competitor in Brazil, Gol. Azul said on Thursday it was in "active talks" with stakeholders as part of a previously announced plan to overhaul its equity structure. It added that options included a structure to use its cargo business as collateral for up to $800m, which had already been set up. Azul could also tap into credit links from the national development bank, it said. After the filing, Azul's shares briefly trimmed their losses to about 18%, but closed on Thursday down 24%. They are now down nearly 70% so far this year.<br/>
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The largest shareholder of ailing Brazilian airline Gol Linhas Aereas Inteligentes SA is nearing a deal to raise $1.3b of funds from investment firm Castlelake LP to stave off the risk of defaulting on its bonds. Abra Group Ltd., which also owns Colombian airline Avianca Holdings SA, outlined Castlelake’s proposal to its investors last week, according to people familiar with the matter, who asked not to be named because they aren’t authorized to talk about it. Under the plan, the investment firm would refinance Abra’s secured bonds due 2028, which could default after Gol raised a bankruptcy loan as part of its Chapter 11 procedure in the US, the people said. A representative for Abra said the details of the plan have been made available to bondholders, but declined to comment further. Representatives for Castlelake didn’t return emails seeking comment. Castlelake is emerging as one of the biggest private investors in the aviation industry. The firm has recently become the co-owner of Scandinavian airline SAS, in partnership with Air France-KLM, after committing fresh funding in its bankruptcy process, and provided a loan to United Airlines in 2023. It’s now seeking to expand to Latin America, where carriers have struggled to bounce back from the Covid-19 shock. Castlelake offered to refinance the bonds at a premium above face value with a five-year term loan, the people said. The notes trade at 105 cents on the dollar, according to data compiled by Bloomberg.<br/>
German pilots' union VC has extended a strike at Lufthansa's leisure airline Discover on flights from Germany to six days, ending one minute before midnight on September 1, the union said on Thursday. The strike was announced last week amid a wage dispute between the airline and the unions which have already held several strikes and bargaining rounds together with bigger rival union Verdi earlier this year. A Discover Airlines spokesperson condemned the decision by the union as "completely unacceptable", adding it had managed to carry out over three quarters of planned flights despite the strike since it begun on August 27.<br/>
Aeroflot Group is claiming a net profit of Rb42.3b ($462m) over the first half of the year, under international accounting standards. It attributes the performance to higher traffic levels and load factor, combined with cost control. Adjusted for exchange-rate valuations and the effect of insurance settlement in the first half, the net profit would have been Rb27b. The company made a first-half loss of Rb102b – or Rb20b after adjustments – last year. “Aeroflot has continued to improve its financial results over the past four quarters,” says finance chief Andrei Chikhanchin, adding that the company achieved the interim net profit “for the first time in a long time”. He says the operating environment “remains challenging”, with the company having to cope with international flight restrictions – requiring “non-standard solutions” – while fuel, airport fees and maintenance costs are increasing. Maintenance expenditure more than doubled to nearly Rb19b, albeit from a relatively low base, as a result of “significant increase” in the cost of components, says the group. Chikhanchin says achieving profitability is important given the conditions under which the company is operating, and the need to ensure funding for its digital transformation programme and other capital expenditure.<br/>
India's aviation watchdog said it has placed budget airline SpiceJet under enhanced surveillance with immediate effect after a recent audit revealed "certain deficiencies". Thursday's move came three weeks after the Directorate General of Civil Aviation conducted a special audit following reports of flight cancellations and financial troubles. "This would entail increase in number of spot checks/ night surveillance with a view to ensure safety of operations," the DGCA said in a statement, citing the airline's past record and the special audit. The watchdog did not disclose the exact issues it found. The DGCA had conducted a special drive of spot checks on the carrier in 2022 and put it under enhanced surveillance again in 2023. A SpiceJet spokesperson sought more time to comment on the latest action. The Hindu daily reported earlier in the day that SpiceJet had to operate empty flights from Dubai as passengers were not allowed to check in because of the airline's unpaid airport dues, marking at least the second such disruption this month. The current disruption is the latest in a long list of troubles for SpiceJet, which has struggled to fully restore operations despite multiple fundraises over the last year. A SpiceJet spokesperson said the cancellations were "due to operational issues" and affected passengers were accommodated on subsequent SpiceJet flights, on other airlines or provided with a full refund. All scheduled flights from Dubai were now operating as planned, according to the spokesperson.<br/>
India's aviation watchdog has issued a show cause notice to Akasa Airlines over several regulatory breaches identified during a recent review, the Directorate General of Civil Aviation (DGCA) said in a statement on Thursday. Akasa Air, which started flying international in March, was found to be non-compliant with civil aviation regulations and Rule 140C of The Aircraft Rules 1937, which mandate scheduled air transport services to carry a route guide. The airline said it had received a DGCA notice regarding the audit conducted in May, and it would submit a response.<br/>The DGCA's spot audit also uncovered that Akasa's practical training sessions were carried out and simulated without the necessary regulatory approvals, raising concerns about the adequacy of the training standards and operational readiness. The watchdog has asked Akasa to provide an explanation for the lapses within a period of seven days. Akasa, the latest addition to India's aviation sector, faced significant setbacks last year after many of its pilots quit, leading to reduced flight operations and a loss of market share. The company has since announced that the problem was resolved. The carrier had a market share of 4.5% at the end of the March quarter, smaller than rivals IndiGo, SpiceJet , Vistara and Air India.<br/>
Malaysia’s AirAsia X expects to fully reactivate its fleet of 18 Airbus A330s by the end of the year, clearing what it calls a “final hurdle” for network expansion. The medium-haul, low-cost carrier is also in the process of firming up the lease of a sole A330, which will enter its fleet in early 2025. The fleet forecast comes as AirAsia X remained in the black for the quarter ended 30 June, though it felt the impact of rising operating costs. AirAsia X posted a positive EBITDA of MYR58.4m ($13.4m) for the quarter, down more than 40% year on year, while net profit stood at MYR4.8m, against MYR5.5m the year before. AirAsia X reported a 30% jump in revenue to MYR669m during a “traditionally weaker” quarter, as the airline ramped up operations and grew its network. Passenger volume rose 42% to more than 880,000, while capacity was increased by 30%. Still, that was offset by a rise in operating costs, particularly with fuel up 43% and staff costs up 26%. Maintenance costs also increased slightly, due to more aircraft in operation. AirAsia X says it is looking at growing across more regions – including to “unique markets” – as well as rebuilding capacity into its core markets. Its Mainland China operations are showing “encouraging” results, with the airline set to launch flights to Chongqing – its seventh destination in the country.<br/>