NICOSIA - State-owned Cyprus Airways announced Wednesday that its net losses in 2004 were significantly worse than first announced after absorbing losses at its Athen-based subsidiary Hellas Jet.
CA's consolidated loss widened to 39.4 million Cyprus pounds (86.3 million dollars, 68.4 million euros) from 33.5 million announced in indicative results on February 25, the company said in a statement to the Cyprus Stock Exchange.
That comes on the heels of a 20.9 million pound loss in 2003.
CA blamed the additional damage on costs related to it being forced to exercise its option on the remaining 25 percent of Hellas Jet, which halted operations last week.
It is now in talks with a private Greek airline to lease its three Airbus A320s, plus crew, for a year.
CA has secured a 51 million euro government-guaranteed loan from Deutche Bank after the European Commission gave its green light to a state bailout of the ailing carrier to organize its restructuring.
The European Union ruled that approving the loan did not violate the bloc's competition rules.
CA is now studying a reworked survival plan to ease itself out of crippling debt.
Brussels has advised the government that CA, for its size, should be operating on only half the 2,400 staff it now employs.
The airline is being outdone by cheaper competitors vying for routes that were previously protected before the skies were deregulated when Cyprus joined the EU last year. It is also crippled by a hefty fleet renewal bill.
The company, aiming for profit in 2007, is seeking job cuts through outsourcing certain departments, such as catering and accounts.
05/18/2005 13:57 GMT