Wizz Air expects net loss as Covid-19 battle continues

Thu, 15th Apr 2021

Wizz Air has said it is expecting to report a net loss of €570-590 million and a full year underlying loss of €475-495 million for F21, as it continues to battle the impact of the Covid-19 pandemic and the ongoing uncertainty surrounding travel restrictions. In a post-close trading update, the company said the only exceptional item the loss related to discontinued fuel hedges, amounting to an estimated €95 million. Wizz Air maintains its investment grade balance sheet and strong liquidity position with a total cash / cash equivalents balance of €1,615m at year-end. The total cash burn in the fourth quarter was €87m (compared versus the pro-forma cash position of €1,702m at the end of Q3, taking the €500m three-year bond proceeds of January 2021 into account). According to the update, the start of F22 (the year ending 31st March 2022) continues to be marked by travel restrictions across Wizzes Air's region and it expects only a gradual traffic recovery into late summer 2021, following what is expected to be a period of good progress of national vaccination plans across key markets. In the short term, the company continues to actively adjust capacity to travel conditions with a focus on cash contribution positive flying, and as a result continues to review aircraft allocation on a market-by-market basis as opportunities arise. In parallel the company said it continues to be focused on its cost base and on liquidity measures to minimise the cash burn rate in this period of transitioning out of Covid-19. Because of the uncertainties around travel restrictions, Wizz Air has said it is not in a position to provide guidance for the year ending 31st March 2022. Its full year F21 results will be published on 2 June, 2021. József Váradi, Wizz Air chief executive, said: 'Despite the continued impact of the pandemic, we are well-prepared with one of the strongest balance sheets in the airline industry, flying one of the youngest and most efficient fleets and having a well-defined, proven business model. Our agility and relentless focus on costs and cash are significant competitive advantages. 'Our network expansion and the investments we have made in our fleet over the past 12 months ensures we are well placed for a return to normal operations and we are convinced we are now even better positioned to be a structural winner in the European aviation sector.' Story provided by StockMarketWire.com

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