Ground handler Swissport has received a funding boost as it continues to battle through the difficult trading conditions resulting from the coronavirus outbreak.
The company said it had secured a €300m binding commitment from an ad hoc group of senior secured creditors, subject to final documentation, which would deliver immediate liquidity for Swissport to trade through the Covid-19 market crisis and the restructuring process.
The €300m adds to the more than €200m in liquidity Swissport still had as of 18 August. In addition, an agreement ‘in principle’ has been reached for a comprehensive restructuring – due to be completed later this year – and refinancing.
Eric Born, group president and chief executive of Swissport, said: “This agreement marks a transformational milestone for Swissport. The €300m of additional interim financing and the planned restructuring supported by our senior secured creditors and other stakeholders gives us the certainty that Swissport will trade successfully through the current market disruptions and emerge as an even stronger industry leader.
“It signals to our customers, our employees and all our other stakeholders that Swissport continues to be the partner they can rely upon. The agreement also represents an endorsement from some of the world’s leading investors in the fundamental strength of our business.”
Swissport also announced preliminary results for the period to June 30. Revenue for the period was €235.5m, 70% down on prior year. Ground handling volumes were down 88% and cargo volumes down 24%.
Swissport said it had seen an uptick in volumes since end of June with volumes in the first half of August up to -67% and -19% relative to prior year levels for ground handling and cargo respectively.
Swissport said that costs have been reduced by more than 55% in recent months with, at some point, approximately 55,000 out of the 65,000 employees pre-crisis on furlough, unpaid leave or made redundant.
Operating losses before interest, tax, depreciation and amortisation (ebitda) stood at €67m euros for the second quarter compared to a €76m profit in the prior year. In July, however, Swissport managed to record again positive ebitda from better revenue, even higher cost reductions and the impact of CARES [the US government Covid-19 support scheme].