Fra Danske Bank:
Finnair – Q2 20
Finnair (MW) reported a Q2 20 in which its revenue dropped by 91% y/y to EUR68m due to Covid-19. Comparable EBITDA dropped to EUR-89m vs EUR126m in Q2 19. Due to the declining profit net debt to EBITDA rose to 5.0x from 1.4x in Q2 19. Finnair expects to operate around 25% of its capacity in July and increase the level to 50% by the end of September.
The daily cash burn is expected by Finnair to remain around EUR2m per day in Q3. End Q2 Finnair had EUR970m in cash including all of the proceeds from the EUR500m rights issue. Furthermore Finnair has access to EUR200m in a commercial paper program and EUR400m in a statutory pension loan that can be drawn if necessary.
Overall this leaves Finnair well capitalised. That said the significant recapitalisations of other European airlines makes it necessary for Finnair not just to survive but to get through the Covid19 with a solid balance sheet in order to be able to compete afterwards. Overall we see the Q2 result as credit neutral.
