CityJet Avro RJ85 at Dublin Internation Airport
The High Courts appointed an interm examiner to Irish regional CityJet to try save the airline from going bust. An Examinership is a process in which the protection of the High Court is obtained to help with the survival of a company. This permits the company to restructure itself and gives them a second chance to settle their financial difficulties. The Dublin-based airline employs 1175 staff with 410 based in the Irish capital. CityJet flies on behalf of Irish airline Aer Lingus and SAS.
Due to the airline grounding its fleet, it has been protected by the courts from its creditors due to their financial difficulties. This pandemic interrupted and affected the merging with another airline and a proposed private restructure of the company according to the Company's counsel Rossa Fanning SC.
CityJet said that they can be saved if the Examinership process is successful. On the 17th of April, Mr Justice Garrett Simons appointed Kieran Wallace of KPMG as their intern Examinership. He is an experienced insolvency practitioner. The airline was unable to pay back their debts on time and were insolvent. The court accepted evidence from an independent expert that the airline has a reasonable change of surviving if they carry out multiple necessary steps. These steps are is being successful in restructuring the airline and for a useful scheme of arrangements with the company's creditors by the Examiner. This has been approved by the High Courts which allows them to continue to trade.
The airline has also implemented multiple cost-cutting measures which as a result is saving the airline millions. They have stopped scheduled flights and has began wet leasing. This is when the serviced aircraft and crew to operate for different carriers.
CityJet suffered losses in both 2018 and 2019 after experiencing a year where they made a profit in 2017. Now, they are €500 million in debt with a current net deficit of liabilities over assets at €186 million. Their creditors include the Triangle Group. The firms involved in leasing aircraft are Invested, the Revenue Commissioner along with other debts owed to related companies.
The tackle with these debts, the airline has put in place with their creditors to restructure the business and join with Air Nostrum. They are a Spanish airline who primarily operate to Nordic and Scandinavian countries. They also own 33 aircraft.
The future is looking bright for the airline as SAS, the Scandinavian airline agreed to support CityJet. CityJet have also had positive engagements with their creditors.
The Counsel stated that their commercial operations would return gradually over the next few months. The Examinership is also beneficial to all parties involved. The Judge is happy with the evidence put before the court.
Mr. Justice Simons has announced that he will postpone the matter of Mr Wallace's approval of the appointment of interim Examiner to a later date. However, the task of including all matters must be taken into account within the next 100 days.
Yesterday, one of CityJet's 9 Avro RJ85 flew from Dublin to Casement Aerodome, Baldoyle in the South of Dublin. This airport is used primarily by the Irish Air Corps. The aircraft operated flight BCY061P and lasted 17 minutes. This Avro RJ85 will be used for fire training in the airport.
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