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Unaudited Interim Management Statement for the period 01/07/2012 - 15/11/2012

Direct News Source

Cyprus Airways Public Ltd (the "Company") announces that on Thursday, 15 November 2012, the Board of Directors of the Company met and approved the unaudited Interim Management Statement of the Company for the period from 1 July 2012 to 15 November 2012, that has been prepared in accordance with article 11 of the Transparency Requirements (Traded Securities in Regulated Markets) Law 2007 and is presented below.

The main activities of the Company, which is the transportation of passengers and cargo, as well as other airline related services, remain the same.

The most significant events and transactions that took place during the reporting period, as well as their impact, where applicable, on the consolidated financial statements, are presented below:

a) The Company in order to cushion the impact of a forecasted decline in demand which came as a result of the continuing financial crisis and the intensifying competition in the main markets where it operates reduced the available seats offered in the market as compared to the same period of the previous year.

b) On 27 June 2012 the Minister of Finance submitted a supplementary budget bill to the Parliament for the participation of the Government, as the main shareholder, in the increase of the Share Capital of the Company. The supplementary budget amounts to €31.330.000 which represents the Government's share in the €45.061.076 increase in share capital. On 12 July 2012 the Parliament approved the participation of the State in the increase in the share capital of the Company in two phases and under certain conditions as these were set out in the Supplementary Budget Law (the "Law") 50(II) of 2012. The first tranche of €15million is released on the condition that the existing members of the Board of Directors appointed by the Government resign and are replaced by eight new members who will be selected by the Minister of Finance and receive the consent of the Parliamentary Committee for Finance and Budget (the "Committee"). The remaining amount of €16.330.000 will be released within three months from date of passing of this Law under certain conditions among which is the appointment of a qualified expert/consultant who will prepare a new restructuring plan for the Company that will be submitted to the Committee for approval. The consultant has to be selected by the Board of Directors of the Company and approved by the Committee within a month from the date of passing of this Law.

c) On 23 August the Government, acting in its capacity as the major shareholder of the company and in accordance with the conditions set out in the Law and its rights provided by the Articles of Association appointed the eight new members of the Board of Directors in place of the members who resigned. The new members are: Stavros Stavrou (Chairman), Panicos T. Pouros, Minos Charalambous, Adonis Pigasiou, Achilleas Tsangaris, Kyriacos Kakouris, Xenakis Xenofontos and Charalambos Tappas. The members that have been elected by the private shareholders remain the same and are: George Kallis, Pavlos Photiades and Constantinos Lefkaritis.

d) The Board of Directors in its meeting on the 11 September 2012 selected Air France Consulting as the consultant that will prepare the new restructuring plan of the Company. The Committee in its meeting on the 13 September approved the selection of Air France Consulting. The appointed consultant completed the preparation of the new restructuring plan which was unanimously approved by the Board of Directors of the Company in its meeting on the 7 November 2012. The plan was submitted to the Committee for approval before its implementation by the Company.

e) On 8 October 2012 the Extraordinary General Meeting (the "EGM") of the Company was held and approved the resolutions that were proposed by the Board of Directors of the Company in its meeting on 11 September 2012. More specifically the EGM approved the reduction in the nominal value of the shares of the Company from €0.09 to €0.01 and the resulting reduction in the authorised and the fully paid share capital of the Company. Furthermore it was approved that immediately following the reduction of the Company's authorised share capital and simultaneously with it, the authorised share capital of the Company be increased to its former level of €135,000,000, divided into 13,500,000,000 shares of nominal value €0.01 each, with the creation of 12,000,000,000 new shares with a nominal value of €0.01 each ranking pari pasu with the existing shares of the Company. The Board of Directors of the Company finally decided that following the approval of the resolutions the issued share capital be increased by €45,061,076 with the issue of 2,253,053,820 new ordinary shares of a nominal value of €0.01 made through a rights issue to existing shareholders at a ratio of one right for every one issued and fully paid share at the time of publication. Every 25 rights with a total price of €2.88 will be converted into 144 fully paid ordinary shares. The previous decision taken by the Board of Directors of the Company in its meeting on the 28 February 2012 has been withdrawn and replaced by the decision above, following the consideration and assessment of the current market conditions.

f) On 19 September 2012 the Company announced its expansion in the Greek domestic market with the launch from the 28 October 2012 of four new routes and the increase in the frequencies of the two existing routes Athens - Thessaloniki and Heraklion - Rhodes. The new routes are: Athens - Heraklion, Athens - Rhodes, Thessaloniki - Heraklion and Thessaloniki- Rhodes.

g) Efforts continue to be made with the aim of attracting a strategic investor
Further information on the developments will be presented with the announcement of the Company's indication of results for the year 2012 expected to take place by the end of February 2013.