Category Archives: SmartWings

Smartwings secures financing as part of its ongoing restructuring

Smartwings has issued this statement:

Smartwings has signed a loan agreement with a syndicate of banks led by UniCredit Bank for a CZK 2 billion (approximately €76 million) loan with a maturity of six years, as part of the the Covid Plus program announced by the Czech government to mitigate the effects of the pandemic. The loan agreement has been concluded with four banks – UniCredit Bank, Komerční banka, Československá obchodní banka and Česká spořitelna. The Export Guarantee and Insurance Company (EGAP) is securing secure the loan. For this guarantee, Smartwings will pay state-owned EGAP a fee of almost CZK 200 million (approximately €764,000). A vital part of the transaction is a significant financial support from Czech shareholders, especially the Unimex Group, without which it would not be possible to draw the loan from EGAP. The restructuring measures adopted by Smartwings, including support from lessors, bring Smartwings additional approx. CZK 5 billion. These measures together with the EGAP loan exceed CZK 7 billion. This amount significantly exceeds Smartwings’ due payables and creates a sufficient financial reserve for a full restoration of air traffic.

As a result of the COVID-19 pandemic and subsequent measures by the government of the Czech Republic and other states, the Smartwings Group recorded an unprecedented drop in revenue. Until now, Smartwings has addressed the situation through a moratorium with the support of creditors. The moratorium ended on March 26, 2021. The Czech Republic is the only European country that does not have a support program for the air transport sector, which is among the industries most affected by the pandemic.

This is a key milestone for Smartwings, after a year of battling the effects of the coronavirus pandemic. The financing deal, which concludes the moratorium process, will allow Smartwings to continue operating over the coming financial period. We appreciate the trust and professionalism that the banks and EGAP have shown us at this difficult time, especially UniCredit Bank, with which we have been cooperating for more than 20 years,” says Jiří Šimáně, Chairman of the Board of Directors of Smartwings.

We are glad to be close to our clients and to be able to support them during these challenging times, thus allowing the restart of the Czech economy and, as regards Smartwings, the operation of the largest Czech airline provider,” said Jakub Dusílek, Chairman of the Board of Directors and CEO of UniCredit Bank.

UniCredit Bank is the main arranger in this transaction and one of the lenders.

Smartwings is working with EY as financial adviser and Dentons as legal adviser on the restructuring process.

Smartwings received significant support from all leasing companies and other companies with which it cooperates, including Lufthansa Technik. The lessors have significantly supported the largest Czech air carrier since the onset of the pandemic.

Smartwings is fully prepared for the upcoming summer season, when it plans to operate flights not only from the Czech Republic, but also from Poland, France, Hungary, Slovakia and the Canary Islands. The Smartwings fleet now numbers 42 aircraft.

Smartwings has signed contracts worth tens of billions CZK with travel agencies in the Czech Republic and abroad for the provision of air transport services.

Until the coronavirus crisis, Smartwings was a profitable company and one of the fastest growing airlines in Central Europe. As a result of the COVID-19 pandemic and government restrictions, Smartwings laid off 600 employees and implemented a number of restructuring measures.

Smartwings is one of the most important companies in the charter flight market in Central Europe. In addition to the Czech Republic, where it operates regular flights to dozens of destinations under the Smartwings brand, it operates in Poland, France, Hungary, Slovakia and the Canary Islands. In addition to scheduled and charter flights, it provides special flights for various major organizations and sports clubs, and has long been involved in arranging UN and NATO-funded flights for the armies of the Scandinavian countries.

Smartwings is also supporting the reorganization process of its subsidiary, Czech Airlines, which was not granted assistance from the Covid Plus program.

Smartwings aircraft photo gallery:

Smartwings aircraft slide show:

Smartwings and Czech Airlines file for protection against creditors as flights continue

Smartwings Group has made this announcement:

Members of Smartwings Group including Smartwings, a.s. (Smartwings) and České aerolinie, a.s. (Czech Airlines, CSA) today filed request to the Municipal Court in Prague to declare an extraordinary moratorium under the so-called Lex COVID legislation. This new law introduced the moratorium as a tool to alleviate the impact of the SARS CoV-2 coronavirus pandemic. The need to apply for the moratorium is solely driven by the impacts of the pandemic that has caused the largest crisis in aviation history. Both companies had been profitable before the pandemic broke out and they are expected to return to profitability once it subsides. The extraordinary moratorium will provide protection to both Smartwings and CSA at a time when their revenues have reduced significantly. Both companies will also obtain time to develop and negotiate a long-term sustainable financing solution that would benefit all concerned parties, i.e., creditors, employees, and passengers.

 

“Smartwings and CSA continue with their standard operations. Both companies operate all scheduled flights and have been resuming additional routes as the epidemiological situation and travel restrictions in the respective destinations allow. Smartwings Group, like other air carriers, has implemented restructuring measures to achieve operational efficiencies and savings. The extraordinarymoratorium is only a temporary measure that grants Smartwings and CSA the time they need to achieve their financial stability in cooperation with financing banks, aircraft lessors and other creditors. We believe that the steps we are taking today will help us to successfully overcome this unprecedented crisis,” says Jiří Šimáně, Board Chairman, Smartwings.

Due to the state of emergency declared by the Czech government and the adoption of special measures in response to the coronavirus breakout, Smartwings Group recorded a year-on-year decrease in air traffic volume of 95 percent between April and June 2020 and more than 80 percent in July and August. Since the onset of the epidemic, Smartwings and CSA have implemented a cost saving program and adopted every possible measure to mitigate the negative financial impact of the coronavirus crisis. Air carriers around the globe, including the largest players (such as Lufthansa, British Airways, Air France, KLM, easyJet, Swiss, Austrian Airlines, Brussels Airlines, Emirates, American Airlines, etc.), have adopted similar measures. While many airlines have already benefited from the support from their national governments (e.g. in the form of capital injection or provision of state-guaranteed loans), Smartwings and CSA have not received any state-support to date.

A support program for large businesses active in the field of transportation and tourism was not implemented in the Czech Republic in the first months of the coronavirus crisis. The COVID Plus program aimed at such businesses that have been affected by the pandemic was launched by Export Guarantee and Insurance Corporation (EGAP) only in the second half of July after notifying the European Commission. Smartwings and CSA are taking steps now to benefit from this program.

“The loan guarantee application process is a complicated and lengthy procedure requiring the agreement of multiple parties. This is one of the primary reasons why Smartwings Group has resorted to the extraordinary moratorium. We are exploring all potential financing options to ensure business continuity of both companies. Throughout the process, we will be cooperating closely with our finance providers and other stakeholders. In this context, we have also mandated an international advisor EY, which has extensive experience in the field of restructuring and finance raising as well as the necessary aviation industry expertise,” adds Jiří Šimáně.

Smartwings currently operates flights from Prague to 25 destinations, from Brno to 9 destinations and from Ostrava to 2 destinations. CSA operates flights to 12 destinations and is planning to resume flights to Barcelona, Madrid, Budapest, Goteborg, Bucharest, Brussels, Warsaw, and Milan in September. Other routes are expected to be resumed depending on the coronavirus situation in the respective countries and applicable travel restrictions.

Smartwings was a successful business before the coronavirus crisis, reporting earnings before tax in the amount of CZK 183 million last year despite problems caused by a global grounding of Boeing 737 MAX aircraft. CSA reported earnings before tax in the amount of CZK 79.2 million in 2019 and has been profitable since Smartwings assumed partial management responsibility. Smartwings Group reported revenues of CZK 28 billion in 2019. Smartwings and CSA transported more than 9.6 million passengers in total last year.

Travel Service takes delivery of its first Boeing 737-8 MAX 8

First Boeing 737-8 MAX 8, delivered on January 30, 2018

Boeing, GE Capital Aviation Services (GECAS) and Travel Service Airlines, the largest carrier in the Czech Republic, celebrated the delivery of the airline’s first 737 MAX airplane.

Travel Service is leasing the airplane – a more fuel-efficient, quieter, and longer-range version of the 737 jet – from GECAS, the commercial aircraft leasing and financing arm of General Electric.

The new type will be operated under the Smartwings brand.

Copyright Photo: SmartWings (smartwings.com) Boeing 737-8 MAX 8 OK-SWA (msn 43555) BFI (Joe G. Walker). Image: 940838.

Smartwings aircraft slide show:

 

Travel Service finalizes its order for five Boeing 737 MAX 8 airplanes

Travel Service, the Czech airline company that operates scheduled flights under the SmartWings brand, has finalized an order for five Boeing 737 8 MAX airplanes, valued at $550 million at current list prices.

Travel Service previously placed an order for three 737 MAXs at the Paris Air Show in 2013 and currently operates a mixed fleet that includes 32 Boeing 737s.

The 737 MAX incorporates the latest technology CFM International LEAP-1B engines, Advanced Technology winglets and other improvements to deliver the highest efficiency, reliability and passenger comfort in the single-aisle market.

The 737 MAX will be 14 percent more fuel-efficient than today’s most efficient Next-Generation 737s – and 20 percent better than the original Next-Generation 737s when they first entered service.

Travel Service is the largest Czech airline company, operating regular flights under the SmartWings brand, charter flights and private flights in the Business Jet category. Travel Service planes are flying to more than 300 airports on 4 continents. Travel Service is present on market not only in the Czech Republic but also in Slovakia, Poland and Hungary, where the company has its subsidiary companies.

Image: Boeing.

AG Read the Real WAN

SmartWings to add three new routes from Bratislava in June, will also start Prague-London Gatwick flights

SmartWings (brand of Travel Service Airlines) (Prague) is adding three new holiday routes from Bratislava starting in June: Olbia (June 14), Palma de Mallorca (June 13) and Rhodes (June 9) per Airline Route.

Routes from Bratislava:

Smartwings 1.2015 Bratislava Route Map

Smartwings logo-1

In addition, the carrier will also start seasonal service to London (Gatwick) from Prague from April 2. The route will be operated four days a week with Boeing 737-800s.

Routes from Prague:

Smartwings PRG 1.2015 Route Map

Copyright Photo: Rolf Wallner/AirlinersGallery.com. Boeing 737-8S3 OK-TSA (msn 29250) taxies at Zurich.

Smartwings aircraft slide show:

 

 

Smart Wings also adds two Boeing 737-700s, revises its livery

Smart Wings (smartwings.com) (Prague), the low-fare brand of Travel Service Airlines (Prague), has taken delivery of its second Boeing 737-700 (pictured). Smart Wings accepted the first Boeing 737-700 (OK-SWX) on March 3 followed by the pictured 737-7Q8 OK-SWW (msn 28254) on June 1 with a third copy due shortly. The new type also ushered in this revised livery. Smart Wings also operates two Boeing 737-800s as previously reported.

Copyright Photo: Javier Rodriguez.

Hot New Photos:

Smart Wings paints the first Boeing 737-800

Smart Wings (smartwings.com) (Prague), the low-fare brand of Travel Service Airlines (Prague), has painted the first Boeing 737-800 in their colors. The pictured Boeing 737-8K5 OK-TVP (msn 32907), formerly in Travel Service livery, was leased from Aircastle on April 19, 2012.

Copyright Photo: Paul Doyle. OK-TVP is pictured at Dublin on May 19, 2012 operating a rugby charter to London (Luton) with Leinster fans on board for the Heineken European Cup Final which was played at Twickenham.

Travel Service Slide Show: CLICK HERE

Smart Wings/Travel Service Prague Route Map:

Click on the map to expand.