Low cost airline easyJet
EZJ,
secured a $ 1.87 billion loan on Monday to address investor concerns about its balance sheet, which was shattered by an unprecedented slump in global travel demand amid the COVID-19 pandemic.
The five-year credit facility was signed by a consortium of banks and is supported by a program from UK Export FinanceeasyJet has some restrictions on future dividend payments
ESYJY,
said in a Explanation On Monday.
EasyJet’s shares fell more than 1% in London trading on Monday.
European airlines like easyJet, which have struggled with the loss of millions of flights since the pandemic started in March, have come under increasing pressure in recent weeks as a number of countries banned flights from the UK on fears of high numbers Has. contagious strain of the coronavirus.
Last week the Irish low-cost airline Ryanair
RYA,
lowered the annual traffic forecast by around 5 million passengers and urged the government to accelerate the pace of vaccine adoption.
The UK has already started administering the vaccine developed by the US pharmaceutical company Pfizer
PFE,
and its German partner BioNTech
BNTX,
as well as the one developed by the British-Swedish pharmaceutical company AstraZeneca
AZN,
together with the University of Oxford. On Friday, Biotech has Moderna
MRNA,
The COVID-19 vaccine was the third authorized in case of emergency by the British regulator.
The government’s goal is to vaccinate 14 million of the most vulnerable people by February 15. Health Secretary Matt Hancock announced on Sunday that the UK has had 2 million vaccinations to date – including a third of the elderly over 80.
To counteract the sudden surge in the new coronavirus strain, regular rapid tests will be offered across England starting this week for people without COVID-19 symptoms, the government said on Monday.
“This vital national testing infrastructure will be so important that we are relaxing the restrictions so that we can use the confidence that accurate testing creates to find the virus and get back to normal life.” Said Hancock in a Explanation.
However, companies in the sectors hardest hit by the pandemic, including airlines, hospitality and retail, are likely to remain under pressure through the fall, when the government plans to finalize adult testing in the UK.
Read: EasyJet seeks government aid as it reports the first loss in its 25-year history
On Monday easyJet
ESYJY,
Chief Executive Officer Johan Lundgren said the new $ 1.87 billion loan secured against aircraft would “significantly” extend and improve easyJet’s debt maturity profile and increase available liquidity.
The airline, which has secured more than £ 4.5 billion (US $ 6 billion) of liquidity since the pandemic began, didn’t rule out further action.
“Few industries have been as badly affected during the pandemic as the airline business and its leading companies, which continue to struggle for months to prop up their finances so they can weather the turmoil unscathed,” said Russ Mold, investment director of AJ Bell .
“These [the loan facility] will add to the money the company raised for itself by placing £ 409m worth of shares in June, selling and leasing back planes, and new credit facilities, and giving it extra room until passengers get back in return to heaven. ” he added.
Read: IAG fluctuates on operational loss and reduces 4Q capacity
Easyjet’s announcement follows that of the International Air Group owner of British Airways
IAG,
which received a £ 2 billion loan in December, also partially underwritten by UK Export Finance. The IAG also said earlier this month that it was also looking for other ways to raise more money.
Starting this week, travelers flying to the UK will be required to provide proof of a negative COVID test Taken within 72 hours of landing.
