À̹ÌÁö È®´ë Asiana Airlines¡¯ financial health is rapidly deteriorating amid stalled integration with bigger full-service carrier Korean Air Lines and little signs of normalization in international air travel.
Asiana Airlines managed to turn out an operating profit in the third quarter thanks to strong demand for cargo deliveries, but ballooning debt has outweighed its capital.
According to its disclosure on Tuesday, Asiana Airlines¡¯ total capital account balance reached 329.2 billion won with equity capital of 372 billion won as of September, delivering an erosion rate of 11 percent.
Impaired capital occurs when a company¡¯s total capital falls below the par value of its capital stock.
Asiana Airlines has been struggling under liquidity crisis for almost two years. Its capital had been completely eroded as of the first quarter of 2020. It avoided crisis by issuing perpetual bonds. When the erosion ratio rose again to 50 percent in the third quarter, the company carried out capital reduction at the end of last year.
À̹ÌÁö È®´ë This is the third capital erosion despite 1 trillion won injection by Korean Air Lines as a part of the acquisition scheme.
Asiana Airlines first received 300 billion won in initial payment from Korean Air Lines and another 400 billion won later. The fund has not been used as the airliner made profit despite standstill in passenger travel on robust cargo business, Asiana explained.
Asiana Airlines¡¯ debt ratio jumped to 3,668.34 percent as of the third quarter from 1,343.80 percent as of late last year after reflecting the 106.9 billion won penalty as the result of a 2015-2017 as losses, it said.
Current liabilities amounted to 5.15 trillion won, exceeding the liquid assets of 1.83 trillion won. The amount of debt maturing within a year reportedly reaches about 3 trillion won, including the short-term debt of 2.56 trillion won.
Its cumulative operating profit up to September this year reached 244 billion won, but this is not enough to pay back interest that increases up to 309.2 billion won including the dividends on perpetual bonds.
State lender Korea Development Bank (KDB) Chairman Lee Dong-gull on Tuesday urged speedy review of the antitrust approval of the marriage of Asiana Airlines and Korean Air Lines amid alarming signs in the financial health of Asiana Airlines that could increase the bailout cost.
The antitrust approval from home and abroad for its union with Korea¡¯s No. 1 full-service carrier has been deadlocked since early this year. The Fair Trade Commission of Korea plans to complete its review and submit a report to the National Assembly within the year, which means that final approval would be made next year. It is seeking ways to control monopolization of the integrated one full-service carrier.
Other states are also in no rush. EU and Japan have not even embarked on a review.
By Pulse
[¨Ï Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]