SAA financial result delay a huge concern - opposition

Johannesburg - South Africa Airways (SAA) again failed to table its 2016-17 annual financial statements while also not holding its annual general meeting. According to the Companies Act the meeting should have been held before the deadline of January 28 this year.

Finance Minister Malusi Gigaba asked for an extension for the tabling of the embattled airline’s 2016-17 annual financial statements in Parliament on Thursday, till April 30 2018. This means that SAA would have miss the deadline prescribed in the Public Finance Management Act (PMFA) by approximately 8 months. 

The delay by the SAA board in presenting the ailing parastatal's annual financial statements was unacceptable, said Democratic Alliance MP Alf Lees.

He said it violated the letter and spirit of the PFMA and the Companies Act which enjoins public entities to table their financial statements timeously.

During a budget press conference on Wednesday, Gigaba said that the government was working with the auditor general to finalise the national carrier’s 2016/17 financial statements. The airline lost R5.6bn in 2014/15 and R1.5bn in 2015/16.

READ: Govt sticking to recapitalisation programme for SAA - Gigaba 

The airline’s financial woes are well known.

It received a R3bn bailout from Treasury in 2017 to avoid defaulting on its loan from Citibank. A senior Parliamentary legal adviser had questioned the bailout, Fin24 reported. This was on top of another government bailout of R5bn, including a R2.2bn bailout Treasury granted the airline in June last year to prevent it from defaulting on its loan from Standard Chartered.

Addressing debt issues at SAA was one of the points in Gigaba’s 14-point plan to revive confidence in the economy. The airline appointed Vuyani Jarana, previously head of Vodacom’s enterprise division, as a permanent CEO.

The airline is also supposed to finalise a five-year turnaround plan by the end of December 2019, as outlined by the plan.

The airline made a deal with domestic lenders in November 2017 to extend the refinancing of R6bn in outstanding loans, Bloomberg reported.

 “SAA has been a drag on the fiscus with billions of rands of taxpayers money used to bail it out.,” Lees said. “Despite enjoying this unwarranted state largesse, SAA is now dithering on providing South Africans with an account of how their money was used.”

He said the DA would ensure that SAA and Gigaba not keep a lid on the financial rot at the airline.

“They will account for every rand that has been spent by the state to keep SAA afloat.”

Treasury and SAA did not immediatly respond to requests for comment.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER
ZAR/USD
16.89
(-0.11)
ZAR/GBP
21.36
(-0.08)
ZAR/EUR
19.22
(-0.18)
ZAR/AUD
11.82
(+0.03)
ZAR/JPY
0.16
(+0.03)
Gold
1810.74
(+0.15)
Silver
18.79
(+0.62)
Platinum
852.00
(+0.53)
Brent Crude
43.32
(+0.49)
Palladium
1920.00
(+0.83)
All Share
55870.69
(+1.13)
Top 40
51558.75
(+1.25)
Financial 15
10275.29
(+1.87)
Industrial 25
77503.35
(+0.84)
Resource 10
52793.47
(+1.49)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1790 votes
I am taking a hit, but should be able to recover in the next year
23% - 2346 votes
My finances have been devastated
35% - 3515 votes
It's still too early to know what the full effect will be
25% - 2526 votes
Vote