LONDON – KLM today has announced that they have repaid the final part of their loan to the Dutch Government, concluding their COVID-19 repayment plan.
In total, KLM borrowed €942 million from a credit facility of €3.4 billion. The airline has stated that demand for airline tickets as well as easing restrictions has enabled this to happen.
The airline paid off €311 million on May 3, another €354 million on June 3 and now the remaining €277 million has been paid off.
Executive Comments…
Commenting on the repayment was outgoing CEO & President Pieter Elbers:
“KLM colleagues battled their way through the COVID19 crisis in 2020 and 2021. The current operational situation at Schiphol is also demanding and again asks a great deal of our people and our customers.”
“I’d like to sincerely thank everyone at KLM for their huge efforts. This last repayment is therefore also a welcome crowning result of everyone’s efforts so far and serves as encouragement for the entire KLM workforce in facing these difficult times.”
Also commenting on the repayment was upcoming KLM President & CEO Marjan Rintel:
“I’m pleased with this important step taken by KLM. Moving forward, I can and will build upon this to achieve even better financial health for KLM in the future.”
Fiscal Responsibility Remains Continued Priority…
Despite this final payoff, KLM’s priority is continued fiscal responsibility. KLM has decided to retain future access to credit.
The Dutch carrier will continue to have a credit facility valued at a whopping €2.4 billion, consisting of a €723 million government loan as well as €1.735 billion from the banks.
This will enable the airline to allow the use of existing financing options for future investment. With this in mind, it means that KLM has sufficient financial structure for the next few years ahead.
Such fiscal responsibility is part of one of the conditions of the Dutch Government, as a reduction in costs needs to be maintained until those conditions have been terminated.
This is a good piece of PR for the carrier, especially after the rocky chaos that has been going on at Amsterdam Schiphol Airport last month.
KLM had been forced to suspend ticket sales due to the ongoing airport chaos at its hub of Amsterdam Schiphol Airport.
Dutch minister Mark Harbers, who serves as the Minister of Infrastructure and Water Management, commented that “while it is quite annoying that the passengers have to face the current staff shortages, however, the staff shortages are a problem which is not exclusive to the aviation industry, and an issue that won’t be an easy 1, 2, 3 fix”.
The problem at the airport has been caused by the unequal distribution of staff members working to handle the passenger flow.
So, with this in mind, this is going to give KLM the opportunity to place conservative investment into slowly fixing the problem of travel chaos caused by the uptick in demand.
It will be interesting to see how the airline operates during the Summer 2022 season, and whether they can get these problems fixed in time for the next busy period. Winter 2022/23.
