South African Airways (SAA) reports back as 90-Day Action Plan concluded on 24 March 2015

Company achievements ensure it is well positioned for full implementation of the LTTS.

SAA (South African Airways) completed the 90-Day Action Plan that commenced late last year. The plan concluded on its scheduled deadline date 24 March 2015 and was a roadmap to stabilise the carrier and resume full implementation of a refined Long-Term Turnaround Strategy. The Plan comprised 6 pillars; to immediately address the liquidity of the business, resolution of future funding, a full review of its high level governance framework, correct governance defects, the reorganisation and optimisation of assets and the implementation of an effective communication plan.

“As the 90-Day Action Plan period concluded, South Africans now have a national aviation asset that is well on its way to relative stability,” says SAA Acting CEO Nico Bezuidenhout. “There is no doubt that while we have achieved significant milestones during the 90-Day period in review, the real task of full implementation of a refined Long-Term Turnaround Strategy (LTTS) is at the starting block.” A full review of the current macro-economic conditions impacting the LTTS formed part of the 90-Day Action Plan.
“The intent and core strategic impetus remains a constant; the Board and management of SAA are unyielding in their resolve to fuel SAA’s future success and short to medium term stability.”

Total annualised EBITDA improvement, from the commencement of our new financial year on 1 April 2015, realised through the 90-Day Action Plan, will amount to R 1.25 billion as per the initial target as agreed in November 2014. This consists of: R 440 million through network changes; R 290 million relating to fleet financing/composition changes; R 100 million recovering stalled LTTS implementation measures; and R 425 million from reviewing onerous agreements, including over 150 procurement contracts. ”This represents the achievement of our target set for the 90-day period, but is by no means the full potential of what we can achieve as we continue to review every aspect of our business,” says Mr. Bezuidenhout.

“The successful completion of the 90-Day Action Plan has placed SAA in a better position to drive further achievement. In addition, the principle of transparency and continually communicating our successes and challenges to South Africans will continue. We need the support and contribution of every stakeholder. When we get it wrong we expect criticism but, concomitant to that, support and recognition of achievement is equally as important. SAA is an asset whose economic benefit is realised daily, in many shapes and forms and stretches across every socio-economic strata of our country.”