National 20.9.2016 03:35 pm

SAA posts shocking R5.6bn losses

SAA Board Chairperson, Dudu Myeni speaks as she engages with a group of stakeholders on the state of SAA at Airways Park in Kempton Park, 8 September 2016. Next to her is Andile Mngxitama. Picture: Neil McCartney

SAA Board Chairperson, Dudu Myeni speaks as she engages with a group of stakeholders on the state of SAA at Airways Park in Kempton Park, 8 September 2016. Next to her is Andile Mngxitama. Picture: Neil McCartney

The airline’s executives led by embattled chairperson Dudu Myeni received a lashing from MPs over its continued loss-making streak and vacant senior positions.

SAA has notched up a staggering R5.6 billion in losses during the 2014/15 financial year.

This was R950 million more than was indicated last week.

This was revealed on Tuesday when SAA accompanied by the senior officials from Treasury presented the national carrier’s interim financial statements to parliament’s standing committee on finance.

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The parties assured MPs that this year’s financial statements would be available by the deadline of 30 September.

Acting chief financial officer Phumeza Nhantsi told the committee, however, that losses in the 2015/16 financial year had been limited to R1.4 billion.

Grilling the SAA and Treasury, ANC MP Makhosi Khoza said SAA could not play the “victim” and blame some of its financial woes on the depression of the rand; the national carrier had to have a fiscal and strategic plan.

The board also argued that international airlines were similarly feeling the pressure, so SAA wasn’t the only one feeling the pinch.

“It’s just not OK,” Khoza said in response, adding that she relied on British Airways and low-cost airline Mango to fly from Durban to Cape Town.

EFF MP Floyd Shivambu said it was “very suspicious” that all board members other than chairperson Dudu Myeni and deputy chairperson and former SAA CFO Tryphosa Ramano, the CEO and chief financial officer occupied their seats on an acting basis.

“We are sitting now with a team of actors,” he said taking a snipe at Myeni, who he called a “calamity” for SAA.

DA MP David Maynier argued that Myeni was a “warlord” and had to go. Myeni was reappointed to the board despite the fact that under her previous term she had been unable to turn the airline’s financial instability around.

“Dudu Myeni is ground zero of the problem,” he said.

Myeni arrived an hour and 40 minutes late for the meeting due to illness, and Maynier again challenged her to resign and was met with a short response: “I never appointed myself; it’s a Cabinet decision.”

Acting CEO Musa Zwane said the new board had to be given a chance to turn the airline around.

The fact SAA was permanently the subject of negative reporting in the media didn’t help.

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Committee chairperson Yunus Carrim wasn’t impressed and argued that SAA did itself no favours.

“You are taken to court all the time; that is why you are in the media,” he said referring to repeated lawsuits the carrier had to face and to his knowledge always lost.

Carrim was also adamant that it was unacceptable that there was no one on the board who had expertise in the aviation industry, leaving a dearth on knowledge and understanding of operational functioning.

He insisted that the position be filled with a matter of urgency.

Deputy Finance Minister Mcebisi Jonas urged the committee to be patient and said the parties were looking for a person with that experience in the meantime. However, the board had to be left to do its job.

“From now until the end of next year Ms Myeni is the chair of the board; can we allow that to happen, quite frankly?” Jonas said.

SAA and Treasury have been called to update the committee in the final quarter of this year.

 

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