Issue link: https://maltatoday.uberflip.com/i/1311619
2 maltatoday | SUNDAY • 22 NOVEMBER 2020 NEWS Delivery fee of just €1 per day for orders up to 5 newspapers per address To subscribe 1. Email us your choice of newspapers, recipient's name, address, contact number to production @millermalta.com 2. Forward cheques payable to Miller Distributors Ltd on address: Miller House, Airport Way, Tarxien Road, Luqa LQA1814 Queries on other news- papers and magazines, production@ millermalta.com maltatoday Same-day delivery of your favourite Sunday newspaper Monday-Friday MaltaToday Midweek • €1 BusinessToday • €1.50 Sunday MaltaToday • €1.95 ILLUM • €1.25 Support your favourite newspaper with a subscription https://bit.ly/2X9csmr CONTINUED FROM PAGE 1 The Maltese government could be playing for time ahead of an official request from Brussels for a substantial state aid injection for the airline. The effects of the COVID-19 pandemic will allow the government to state its case, even though Air Malta itself has not yet resolved its own opera- tional issues. If Air Malta was insolvent be- fore COVID-19 hit, it might not qualify for State aid. Way back in February, despite structural reforms and new ac- quisitions for both aircraft and flight management software, Air Malta still suffered the brunt of reduced air travel to Mediterra- nean destinations like Tunisia, as well as from the price of oil. In 2019, auditors Pricewater- houseCoopers noted "proposed transactions" in Air Malta's business plan would "give rise to funding that meets liquidity re- quirements". While in 2017, the compa- ny reported operating losses of €10.8 million, the airline regis- tered a small €1.2 million profit, prior to restructuring costs. But this was down to clev- er book entries that allow the Maltese government to inject more cash in the airline. Under state aid rules, Air Malta can no longer use taxpayers' cash after the €200 million restructuring programme of 2012. So in 2018, the airline revalued its properties upwards, which gave it a €16 million boost and pad €223 million in accumulat- ed losses from previous years. The real money-spinner for Air Malta however were the millions paid by the Maltese government to buy the airline's landing rights at London Heath- row and Gatwick airports. To do this, the government created a company to acquire the slots and then lease them back to the airline. Those landing rights were giv- en a speculative value of €33.8 million just for the summer alone. That gave Air Malta a much-needed cash boost, de- spite its selling and distribution costs climbing to €15 million and administration expenses to €17 million. The same was expected to hap- pen in the financial year ending March 2019, which accounts are not yet published, where the winter slots would be valued at €22.8 million. Yet even PWC had highlighted major issues relating to the com- pany as a going concern: "the underlying assumption [is] that the business plan 2019-2021 can be successfully implemented... and [that] the confidence that the government has expressed, on the basis of the legal advice obtained, that the proposed ar- rangements do not give rise to any form of state aid and that all restructuring actions are pur- sued within the framework set by the European Commission." Air Malta accounts