The shareholders’ assembly of Aerolíneas Argentinas has approved the financial statement for the year 2023, confirming a final loss of over $220 million for the period. This occurred despite the company capturing more than $500 million in extraordinary financial gains due to the exchange rate gap, which temporarily and artificially reduced its need for Treasury resources.
A Positive Outlook for 2024
However, according to statements made by Lombardo during the assembly, the financial outlook for 2024 presents a stark contrast to the previous year. For the first time since the airline came under state control, the operating balance will be positive.
Surplus Achieved: A Historic Milestone
With a surplus of $20.2 million, the company has, for the first time since its nationalization in 2008, recorded revenues exceeding the costs required for its operations. This milestone coincides with the first full fiscal year under the presidency of Javier Milei.
Debt Reduction and Decreased Treasury Dependency
“This achievement was accompanied by a 25% reduction in the company’s consolidated debt in dollars without affecting its cash flow. Additionally, this year has seen the lowest amount of Treasury funds allocated for current expenses since the company’s nationalization,” Lombardo stated during his address.
A Self-Sustaining Future
He further emphasized that, according to Aerolíneas Argentinas’ projections, the company has informed the Ministry of Economy that in 2025, it will not require financial assistance from the Treasury. “All operations will be sustained with the company’s own genuine revenues. This will position Aerolíneas Argentinas as a valuable asset, enabling its shareholders to evaluate all future alternatives for the company without constraints,” he added.
Cost-Cutting Measures and Workforce Optimization
These financial improvements have been driven by an aggressive cost-cutting strategy, which included reducing the workforce by over 13%, bringing employee numbers to their lowest level in 14 years. This resulted in Aerolíneas Argentinas achieving the lowest employee-per-aircraft ratio in its history. In this process, more than 1,600 employees left the company, and a total of 85 management positions were eliminated, including 8 directorates, 20 managerial positions, and 57 other roles across various categories.
Increased Productivity and Industry Alignment
Moreover, labor negotiations with unions towards the end of the past year were conducted with the objective of increasing the productivity of both fleet operations and ground and flight personnel.
A Step Towards Market Competitiveness
“Our focus this year has been to align the company with industry standards and improve its financial results, making it an attractive prospect for market entry when conditions are favorable,” Lombardo concluded during the assembly held on Thursday, as previously reported by REPORTUR.com.ar.
A Turning Point for Aerolíneas Argentinas
This marks a significant turnaround for Aerolíneas Argentinas, which has been struggling with financial deficits for two decades. With continued efforts to streamline operations and boost efficiency, the airline’s future trajectory appears more sustainable and competitive.