South African Airways (SAA) says it has secured the R3,5-billion loan it needed to keep operating until the end of the financial year in March, providing a temporary relief for the cash-strapped airline, according to Engineering News.
The loss-making flag carrier, which is battling cash flow challenges, is implementing a three-year turnaround strategy, and has said it needs a total of R21,7 billion in loans over the same period.
SAA spokesperson Tlali Tlali told Fin24 on Tuesday that the R3,5 billion, which has been secured from local lenders, was part of the R21,7-billion funding requirement.
He said the funds would enable the airline to operate up to the end of the financial year in March. In October, the National Treasury allocated R5-billion to SAA, as announced during the medium-term budget policy statement.
The funds were directed at debt repayment.
Tlali stated that there was no expectation that SAA was going to become profitable before 2021, stressing that plans were underway to steer the airline out of its financial quagmire.