Acsa to monetise assets in effort to mitigate Covid-19 impact
CFO Simphamandla Mthethwa says this strategy will enhance Acsa’s core aeronautical activities.
Airports Company South Africa (Acsa) reported on Thursday that it plans to monetise assets and activities to improve its liquidity and significantly decrease its capital and operational expenditure. The company stated that these plans will help mitigate the damaging impact of Covid-19 on the aviation industry.
“In responding effectively to the devastating impact of the pandemic we have adapted our strategy to focus on enhancing core aeronautical activities,” said Acsa CFO Siphamandla Mthethwa. “Our strategic response includes a process to release wealth associated with non-core assets.”
He explained that the monetisation of non-core investment properties will make cash available for core business activities as well as reduce the budget allocation to non-core activities. “In the process we are confronting tough choices and difficult decisions. However, we believe that our response is necessary to sustain Acsa through the recovery in aviation which will take at least three to five years.”
The company has recently disposed of its 10 percent share in Mumbai International Airport, which brought in some R1.2 billion. According to Acsa, this represented a profitable return on the entity’s investment, originally made in 2006. And, as it is no longer the operator of the airport, Acsa no longer has to provide an airport operator guarantee, which came to R700 million during the 2020 financial year.
“Before Covid-19, Acsa enjoyed a reputation as a well-run state-owned company,” said Siphamandla. “We believe that this reflects qualities embedded in our culture that position Acsa to manage through the crisis in the best way possible.”