LV: airBaltic's losses in 2011 at EUR 119mn.

By bne IntelliNews July 31, 2012
BoD-approved losses of Latvian national air carrier airBaltic in 2011 were LVL 83.2mn (EUR 119mn), Ministry of Communication informed portal. The losses were due to an operational model not corresponding with a market situation, as well as a number of court proceedings in 2011, ministry commented. Previously companys losses were estimated at LVL 77mn. As reported, troubled national air carrier airBaltic could start running with profits in 2015, Minister of Transportation Aivis Ronis told the press after a government's meeting dedicated to the company this month. Current business plans sees the company avoiding losses in 2014 already. To remind, in the end of 2011 47.2% airBaltic shares held by BAS were bought by the Transport and Communication Ministry, thus bringing the state's share in the company to 99.8%. As reported in H2/11, the conflict between the CEO of airBaltic Bertold Flik and the government ended with the resignation of Flik and appointment of Martin Gauss, a former CEO of Hungarian airline Malev. Flik was working as airBaltics CEO since 2002. Fliks resignation was one of the conditions of government-approved austerity package for airBaltic. Government approved increasing the capital of airBaltic by LVL 57.67mn (EUR 82mn), should the private shareholders of the company Baltijas Aviacijas Sistemas comply with governments conditions. BAS was expected to invest LVL 50mn, proportional to its share in the company, to cover operational losses. In the meantime, with the recent crash of Latvijas Krtajbanka which was one of the main creditors of airBaltics, the government doubted BAS's ability to increase airBaltic's capital and took over the airline completely.
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