On the back of strengthened financial position due to the rights issue, Finnair acquired six previously leased aircraft and repaid a part of its pension premium loan
Finnair Plc Stock Exchange Release 19 December 2023 at 9:00 a.m. EET
Finnair executed a rights issue of 570 million euros in November 2023. Thanks to the strengthened balance sheet and cash funds resulting from the rights issue, Finnair has now purchased six previously leased A321 aircraft from BOC Aviation. Finnair will spend in excess of 200 million euros on the transaction, and its positive impact on both profit before taxes and cash flow will be in excess of 20 million euros per year over the next few years.
Finnair has also repaid an additional tranche of 120 million euros of its 600-million-euro pension premium loan in December in addition to the previously planned 100-million-euro instalment. The December instalment, including interest, totals approximately 230 million euros, after which the remaining loan amount is 280 million euros, to be repaid during May 2025 at the latest. The impact of the additional loan repayment of 120 million euros on profit before taxes will be approximately 3 million euros in 2024 in the form of lower net interest costs.
In connection with the rights issue announcement in autumn 2023, Finnair supplemented its financial targets, which were based on the assumption that e.g. the company's cash to sales ratio would remain at 30 per cent over time. As a result of the aircraft purchases and the loan repayment, Finnair's cash to sales ratio is close to but still exceeds the target of 30 per cent.
These measures are a part of Finnair's strategy implementation and support reaching financial targets by the end of 2025. In addition, these measures will contribute to reaching Finnair’s target of reinstating shareholder distributions, based on the 2024 result, starting from spring 2025.
FINNAIR PLC
Further information:
Finnair communications, 358 9 818 4020, comms@finnair.com
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Finnair is a network airline, specialising in connecting passenger and cargo traffic between Asia, North America and Europe. Finnair is one of the oldest operating airlines in the world, celebrating its centenary in 2023. Sustainability is at the heart of everything we do – Finnair intends to reach carbon neutrality latest by the end of 2045. Customers have chosen Finnair as the Best Airline in Northern Europe in the Skytrax Awards for 13 times in a row. Finnair is a member of the oneworld alliance. Finnair Plc’s shares are quoted on the Nasdaq Helsinki stock exchange.