Category Archives: South African Airways

South African Airways takes “urgent steps” and remains optimistic

South African Airways Airbus A330-243 ZS-SXV (msn 1249) JNB (Paul Denton). Image: 910169.

South African Airways is taking drastic steps to reduce losses and turn around the flag carrier. The airline will continue to cut or reduce loss-making routes. SAA will also continue to transfer aircraft to lower-cost subsidiary Mango.

The airline has issued this statement:

The board and management of South African Airways are taking urgent steps to address issues raised by the Auditor-General’s office in its 2016-17 audit report, and remains optimistic about the airline’s future.

“The board of SAA has noted and accepted the Auditor General’s report,” says CEO Vuyani Jarana. “The majority of the airline’s operations are sound, and we are building on this to ensure we break the loss-making cycle and transform the airline into a viable and sustainable entity.

“The board has developed and approved a clear strategy and five-year plan to turn the airline around, and we are working closely with the board and the shareholder to ensure we succeed.

“SAA has had many previous turnaround strategies which have not been implemented before. This time it is different: we believe the vision outlined by the board is absolutely correct, and are committed to ensuring it is put into practice.

“We need a clean break with the past and a new approach to the future, and that is precisely what we are doing. We are acting with urgency to ensure the viability and sustainability of this crucial national asset,” says Jarana.

Jarana points out that the AG’s report was the first since the Auditor General was appointed as SAA’s auditors, having been appointed as part of the airline’s commitment to audit firm rotation. The report released last week covers the financial year ending March 2017, and Jarana says it has “provided a fresh pair of eyes, particularly as the team went a number of years back where required to establish an appropriate baseline.”

“The AG has given us a comprehensive diagnosis into key areas of our business and this has provided deep insights which will contribute to a fit for purpose group of businesses.”

The AG’s report forms part of SAA’s Integrated Report along with financial results for FY2016/2017, which are due to be announced later this month. The airline has incurred a net loss of R5, 569 billion (2015/2016: R1, 478 billion) and expects that its financial situation will not be much different for FY2017/2018.

However, a number of significant steps have already been taken as part of the turnaround strategy, with the clear aim of taking SAA to profitability in the medium-term.

The five-year plan and strategy require support and funding by the shareholder. The board and the shareholder are currently evaluating the appropriate terms for such support.

The immediate focus of the strategy is on liquidity management, balance sheet restructuring, cost management as well as revenue optimisation, which are intended to stem the losses and drive profitability.

Key steps already taken include:
·       Improving governance by strengthening the board and its structures.
·       Injecting R10-billion capital into SAA to improve its balance sheet.
·       Addressing the leadership vacuum by filling key executive vacancies.
·       Bringing in a depth of aviation skills by hiring the Chief Restructuring Officer (CRO).
·       Implementing key market-facing initiatives aimed at stopping ongoing losses.

Furthermore, network optimisation has been implemented on the domestic, regional, and international route network to improve yields.

The London route will be served by an upgraded product and reduced to a single daily service.

These network changes are necessary as SAA’s route network remains under intense scrutiny with clear defined minimum profit margin target at route and network level. A change hub has been setup as command centre for implementation of the change initiatives.

The R10-billion capital injection from National Treasury late last year has helped restructure the balance sheet and improve SAA’s equity position.

“However, it is important to note that SAA has never been properly capitalised, and any company has a defined maximum debt capacity beyond which debt becomes a burden. We need to do more and work closely with the shareholder to find lasting solutions that will materially improve SAA’s equity position,” says Jarana.

“Notwithstanding all the financial challenges facing SAA, it remains a well-recognised and respected brand in the aviation industry. We have a great reputation and track record for passenger safety and our on-time performance is among the best in the aviation industry, as well as numerous air travel recognition awards.

“We can assure our suppliers, creditors, customers, trade partners and the rest of our stakeholders that the shareholder, the board and management are doing everything practically possible to address SAA’s financial status and to transform the airline’s financial, commercial, and strategic position.

“The board and shareholder are determined to build a financially sustainable airline,” concludes Jarana.

Copyright Photo: South African Airways Airbus A330-243 ZS-SXV (msn 1249) JNB (Paul Denton). Image: 910169.

South African Airways aircraft slide show:

Advertisements

Video: Cockpit View: South African Airbus A340-600 Johannesburg – Munich

From Just Planes: JustPlanes filming on the flightdeck of the South African Airways Airbus A340-600 (ZS-SNE) operating flight SA264 from Johannesburg to Munich.

After 10 hours 23 minutes of flight we make our final approach and get some nice views after sunrise especially on final approach.

South African Airways gets a government capital infusion

South African Airways Airbus A340-313 ZS-SXE (msn 646) IAD (Brian McDonough). Image: 920715.

South African Airways on October 25, 2017 issued this statement:

1. South African Airways (SAA) welcomes the announcement of a capital injection made by government for the airline on October 25, 2017. The injection will go a long way to stabilise the airline financially and will help restore the confidence of all stakeholders in the operational sustainability of the company.
2. In order to turn its fortunes around, SAA had approached its shareholder with a request for recapitalisation of R13.1 billion over three years. The announcement today means that a total amount of R10 billion has been allocated to SAA in the current financial year. For the period ending 30 September, the airline received R5.2 billion.  Of this, R2.2 billion was used to settle a maturing loan with Standard Chartered in July 2017 and another R700 million was paid to Citibank in September this year as part of the agreed payment plan and R1.2 billion was used towards working capital requirements.  The funds remaining out of the R5.2 billion are ring-fenced to enable SAA to meet its payment plan with Citibank and to cover working capital requirement and/or partially settle the domestic lenders. Out of the remaining R4.8 billion, 60% will be used to partially pay the local lenders and the remainder of the funds will be used as working capital.
3. SAA is aware and sensitive to the reality that the allocation comes at a time when government faces a number of demands competing for resource allocation. This calls for departure from a mundane flight path, work with urgency towards bringing more shareholder value, and become financially sustainable in the shortest time possible.
4. The implementation of SAA’s turnaround plan must switch to a higher gear and reassure through results, all stakeholders that the airline is on course towards financial sustainability.
5. Both the lenders and the shareholder have imposed strict conditions, increased oversight and demand more accountability from the airline.  The conditions imposed include revalidation of the turnaround plan and implementation thereof within specific time frames, appointment of mission-critical personnel (including a permanent Chief Executive, Chief Financial and Chief Restructuring Officers) as well as compliance on all governance issues. In addition, four other executive management positions will be advertised this weekend. Furthermore, National Treasury last week announced new appointments to strengthen the current SAA board of directors.
6. SAA has made significant headway in meeting the requirements set out by the shareholder and its lenders. The company has no intention to falter on the remainder of the conditions.
7. SAA is implementing some major initiatives as part of its remediation to improve financial performance and optimise operational performance. The airline has already announced its network changes and other milestones will be announced as the turnaround plan is implemented.
Copyright Photo: The Airbus A340-300s are now likely to be replaced sooner with any reorganization. South African Airways Airbus A340-313 ZS-SXE (msn 646) IAD (Brian McDonough). Image: 920715.

South African Airways takes delivery of its first Airbus A330-300

south-african-a330-300-f-wwkt-zs-sxi97grd-tls-airbuslrw

South African Airways (SAA) has taken delivery of its first of five new leased A330-300 widebody jetliners, becoming Airbus’s first Southern African operator of the aircraft type.

The pictured A330-343 F-WWKT became ZS-SXI (msn 1745) when it was handed over to the carrier on December 1, 2016.

SAA’s A330-300 are configured in a comfortable two-class cabin layout with 46 seats in Business Class and 203 in Economy class seats.

SAA has selected the latest 242-ton Maximum Take-Off Weight (MTOW) variant of the A330-300, which incorporates a new aerodynamic packages enabling the aircraft to cover distances of up to 6,350 nautical miles (11,750km) in flights up to 15 hours in duration. This payload/range capability allows the aircraft to be deployed across SAA’s long-haul, intra-Africa and peak domestic routes.

Photo; Airbus.

ag-airline-aircraft-slide-show

ag-unique-holiday-aviation-gifts

 

Air China announces a new code share agreement with South African Airways

Air China (Beijing) has announced a code share agreement with South African Airways (Johannesburg) that will enable SA to put its code on CA’s newly inaugurated nonstop service between Beijing and Johannesburg as well as points beyond Beijing to Chengdu, Shanghai, Hangzhou and Chongqing.

Air China logo-1

Air China will in turn put its code on SA’s services between Johannesburg to Cape Town, Durban and Port Elizabeth. The code share arrangement will open for sale from August 25, for travel effective October 29, 2015.

South African logo-1

Both airlines are Star Alliance members, an alliance offering a network unlike any other; with 28 member airlines providing over 18,500 flights a day to over 1,330 destinations in more than 192 countries around the world.

The flights, CA867/8 Beijing – Johannesburg are to be operated on Tuesday/Thursday/Sunday (outbound) and on Monday/Wednesday/Friday (inbound). The outbound flight departs from Beijing at 23:15 Beijing time, and arrives in Johannesburg at 7:35 local time on the following day. The inbound flight departs from Johannesburg at 11:50 local time and arrives in Beijing at 7:30 Beijing time. The flights are to be operated with Boeing 777-300 ER aircraft.

Copyright Photo: AirlinersGallery.com. Air China’s Boeing 777-39L ER B-2006 (msn 44931) in the special “Love China” livery taxies at London (Heathrow).

Air China aircraft slide show: AG Airline Slide Show

South African aircraft slide show: AG Airline Slide Show

JustPlanes 25 Years banner

South African Airways celebrates the inaugural flight from Washington Dulles to Accra, Ghana

South African A340-600 Accra inaugural at IAD (SAA)(LR)

South African Airways (SAA) (Johannesburg) continues to expand its West African network and celebrated its inaugural flight between Washington (Dulles) and Accra, Ghana, on August 3, 2015.

Flight SA 209 from Accra arrived at Washington Dulles International Airport at 6:05 AM and flight SA 210 departed at 5.40 pm under a ceremonial water cannon salute (above).

Both flights were operated with Airbus A340-600 aircraft, featuring 42 full-flat 180 degree beds in Premium Business Class and 275 seats in Economy Class.

Celebrations at Washington Dulles Airport included local Washington, D.C.-based Ghanaian drummers and dancers, who performed at the boarding gate for SAA’s first passengers departing to Accra and representatives from the Ghanaian Embassy, the South African Embassy, the Metropolitan Washington Airports Authority and Destination D.C.

With the introduction of this new flight, SAA is providing the only nonstop flight between Washington D.C. and Ghana, as well as the only Skytrax 4-Star rated airline service and world-class quality from North America to the entire West Africa region. South African Airways also offers convenient connections from over 50 markets in the U.S. and Canada through its airline partners United Airlines, JetBlue Airways, American Airlines and Virgin America via Washington, D.C.-Dulles.

South African logo-1

South African Airways’ flights to Accra are available four days a week with continuing service to Johannesburg, South Africa, operating on Monday, Tuesday, Thursday and Saturday. SAA also provides nonstop service from Washington D.C.-Dulles to Dakar, Senegal and onwards to Johannesburg, three-times per week, operating on Wednesday, Friday and Sunday.

This new route is part of South African Airways’ continued expansion in North America, where the airline is the only carrier to offer daily nonstop service from New York -JFK International Airport to Johannesburg, South Africa.

Photo: South African Airways.

SAA aircraft slide show: AG Airline Slide Show

AG No Ads-Beautiful

South African resumes nonstop Johannesburg-New York JFK flights

South African Airways (SAA) (Johannesburg) has resumed nonstop service on its daily flight from Johannesburg to New York-John F. Kennedy International Airport, effective March 7, 2015. While SAA’s daily flight from New York-JFK to Johannesburg has operated on a nonstop basis for several years, the return flight was making a 1-hour enroute stop in Dakar, Senegal, during the low season winter months. Due to the popularity of this route, SAA’s service between New York and Johannesburg will, once again, operate nonstop in both directions on a year-round basis. The resumption of the nonstop service on the northbound flight from Johannesburg to New York-JFK reduces the overall travel time on the route by nearly 90 minutes, making it the fastest way to travel from South Africa to New York.

SAA’s flights between New York-JFK and Johannesburg are operated on wide-body Airbus A340-600 aircraft, featuring 42 full-flat 180° beds in Premium Business Class and 275 seats in Economy Class.

Copyright Photo: Jay Selman/AirlinersGallery.com. Airbus A340-642 ZS-SNI (msn 630) arrives at JFK International Airport in New York.

South African Airways aircraft slide show: AG Airline Slide Show

AG Aviation friend