The bankrupt Czech Airlines (CSA) suffered a severe blow, which can be fatal for them. The European aircraft manufacturer, Airbus, reported receivables from the Czech carrier in the total amount of approximately 17 billion crowns. The insolvency administrator will now assess their eligibility.
The vast majority of receivables relate to invoices for four A220-300 aircraft and three A321XLR aircraft, which CSA ordered in 2019, but was subsequently unable to repay them. CSA was to include the first two A220s in its fleet at the end of last year; deliveries of larger A321XLR aircraft were to begin in 2025.
Airbus states in the documents that CSA did not pay it the invoices, which, after taking into account the interest on arrears, are worth 6.4 billion crowns. At the same time, the Czech company was to repay one of these invoices in December 2019. Another 2.1 billion is still to be paid by the Czech air carrier from the same contracts, but their due date has not yet occurred.
In total, unconditional receivables have a value of approximately 8.5 billion crowns. In addition, however, Airbus has also registered contingent receivables, which Czech Airlines will have to repay if it withdraws from the purchase agreements. Their value is the same, ie 8.5 billion.
At the same time, CSA stated in its February insolvency petition that it recorded a debt in the total amount of only 1.8 billion crowns. Now the company declined to comment on anything. CSA spokeswoman Vladimíra Dufková only stated about the agreements with Airbus that this is a trade secret.
According to Natland’s chief economist Petr Bartona, the entry of a new major creditor may influence the decision-making between bankruptcy and reorganization. “It can be assumed that a big global company will not want to risk its reputation by filing doubtful claims. On the other hand, incidental disputes are likely to be conducted over eligibility when there is a big difference between the debtor’s and the creditor’s idea of their amount, “says Bartoň.
The registered Airbus receivables will be reviewed by the CSA insolvency administrator, Michael Šefčík from Inskol. However, he points out that the evaluation of eligibility will take some time due to the enormous number of applications. To date, about 5,500 of them have been registered, and according to Šefčík, their number will probably continue to grow.
CSA, which lost about 1.5 billion last year, announced the dismissal of all its remaining 430 employees in February. The Smartwings aviation group, of which Czech Airlines is a part, has repeatedly asked the state for financial assistance. So far unsuccessfully.