Wizz Air Holdings PLC (LON:WIZZ) reported a net loss of €243.1mln for the six months to end-September as passenger numbers plunged over 70% due to travel restrictions and lack of demand due to the coronavirus pandemic.
The Central and Eastern European focused airline said it has a total of €1.6bn of cash at the end of September to see it through to when the travel industry picks up again.
While the board’s base cash outlook is that the company will continue to be able to complete flights at reduced capacity over the coming months, it has also prepared for a “severe but plausible” scenario where all planes are grounded until its March 31 year-end and reduced capacity continues for six months after that.
Even in the more bearish scenario, the Budapest-headquartered company said it still is forecasting “significant liquidity”, given the strength of its balance sheet and a €70mln-per month cash burn rate, which includes the cost of the operations, leases and cash payments linked to fuel hedges.
Chief executive József Váradi boasted that Wizz Air “distinctly outperformed the industry in the second quarter of the current financial year”, with 5.8mln passengers carried at 66% load factor and 72% of last year’s capacity.
During the half-year the group announced 13 new bases and added more than 260 new routes, including a new Abu Dhabi airline that is ready for launch once restrictions allow.
Váradi said for the winter period, conditions are expected to be “particularly challenging” with ongoing travel restrictions due to COVID-19 as well as the seasonal drop in demand for travel, but the group will “strive to maintain cash-positive flying with a disciplined approach towards capacity.”