The president of TAP, Fernando Pinto, said today at the presentation of the 2014 results that there had been no loss of interest in the privatisation of the state owned airline.
Some of the potential buyers of TAP already have pulled out of the process as they have ‘lost interest’ but Pinto said that "each company will speak for itself and have its own strategy" and he already has made presentations to several.
As for the results from last year’s trading, Pinto commented that the reasons for the €46 million loss included technical problems, six new aircraft were delivered later than expected and that 22 days of strikes by various of the nine unions representing TAP workers had not helped matters, all of which cost the airline €108 million.
The new aircraft are working on routes to Colombia, Brazil and Panama and are being used within Europe.
Pinto says that there had been a concentration of technical incidents in a short period but that overall TAP was no better or worse than its competitors when it came to keeping the fleet flying.
In 2013 the state airline made profits of €34 million and the government was delighted that ‘the value of the airline is increasing.’
Last year's loss was the first in five years and could not have come at a worse time with potential buyers of TAP looking for excuses to reduce their offers and with unions keen to blame management for the strikes and still opposed to the state airline sell off, fearing modernisation, efficiency, wage cuts and redundancies.
On the positive side, passenger numbers rose 6.6% last year and the load factor was 80.6%, up from 79.4% in 2013 so it was mainly operational issues that produced the loss which included €12 million shelled out to passengers in compensation payments.
The TAP group debt at the year’s end was €1,062 million, up slightly from €1,051 million at the end of 2013.
The government wants the new owner of TAP to ‘invest €1 billion,’ keep Lisbon as an operational hub, maintain at least a minimum service to Lusophone countries, and to be happy leaving the state with a golden share of 33% enabling Ministers to meddle in future strategy.
Whichever suitors stay the course and put in a bid under the above conditions remains to be seen but with reported trading losses, unsettled unions and unattractive terms and conditions of sale on the table, the treasury can expect bids certainly at the lower end of expectations.
