The financial situation of Airlines Corporation (NAC), national Flag carrier has been submerged in danger. A statement issued by NAC on a Press conference on Thursday (November 15) showed the profit, loss, capital and long-term debts of NAC that gives a clear hint of crisis in NAC.
The corporation as an only option left has demanded financial support from the government immediately.
According to the statement, long-term debt has reached around NRs. 37 Billions 580 Millions and the corporation has loan of more than NRs. 12 Billions from Citizen’s Investment Fund (CIF) at 10.5 per cent interest. The annual interest of loan only is more than NRs. 3 Billions. The sanctioned loss of the corporation has reached NRs.2 Billions 600 Millions and the authorized capital is NRs 300 Millions.
Madan Kharel, newly appointed executive chairman of NAC stated that the loan procured while purchasing the new aircraft is NRs 32.87 Billions. Therefore, it is necessary to establish a strong financial status immediately by investing capital from Nepal Government for minimizing risks, he added.
The market share of the corporation has fallen by nearly two percent in one year period. According to the corporation, the market share fell by 1.8 percent in 074/75 compared to the financial year 2073/74.
Only the internal share of the corporation has declined by 1.3 percent. The corporation has decided to increase the market by new market management strategy. The corporation has also witnessed decline in ‘Seat Factor’ in the past months of August and September.
Similarly, the issued statement also stated that the corporation has been preparing to conduct flights in in Japan, Riyadh and Korea.
NAC previously also had demanded a sum of NRs. 20 billion with government for capital enhancement.
Currently, NAC has 2 wide body Airbus A330, 2 Airbus 320 and 1 Boeing 757 aircrafts for operating international flights and 4 Harbin Y-12e, 2 MA-60 and 2 Twin-otter for conducting domestic flights.