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Swissport suffers Sh2.6 billion net loss, but eyes recovery

Wednesday June 02 2021
Swiss port pic

A Swissport Tanzania wprker handles cargo at the Julius Nyerere International Aiport in Dar es Salaam. PHOTO| FILE

By Josephine Christopher

Dar es Salaam. Ground and cargo handler Swissport plunged into a net loss of Sh2.587 billion last year when the airline and the travel industry was hit by the Covid-19 pandemic.

According to the company financial statement for the year ended December 31, 2020, the firm went into a loss compared with a profit of Sh2.31 billion during the previous year.

However, the firm’s chief executive officer, Mr Mrisho Yassin, said the company hopes for full recovery come 2022/23 financial year as there are developments in the fight against the pandemic such as provision of vaccinations and revival of flights.

“Currently what we are doing is reassessing the business environment while controlling and cutting costs to our operations,” he said.

A drop in the volume of cargo and suspension of flights following the outbreak and spread of the pandemic reduced the operations of the company, whose revenue dropped by 25 percent to Sh26.7 billion.

“The huge losses can also be a result of the increasing costs of retrenchment in 2020. “Our company used nearly Sh1 billion in paying compensations to laid off staff,” he said. Swissport Tanzania Plc, which is locally listed on the Dar es Salaam Stock Exchange (DSE), has also notified its shareholders that there will be no dividend payment for the year 2020. This will be the second year in a row as no dividend was declared by directors for 2019.

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According to Mr Yassin, in 2019 the board did not approve dividend as the profit that was recorded in that year (Sh2.31 billion) was a significant drop from Sh7.45 billion profit recorded in 2018.

The last time the company offered dividend was in 2018 when a total of Sh3.73 billion was declared.

“We would like to reassure our shareholders that the company will return to profit as the economy is recovering from the pandemic. We can see light at the end of the tunnel,” insisted Mr Yassin.

According to the company’s statement, the future of the aviation industry is still clouded with uncertainties due to Covid-19 which causes travel restrictions.

However, the ongoing global rollout of vaccine programmes brings hopes for the recovery of the business.

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