LONDON (Alliance News) - fastjet PLC on Monday issued a profit warning for 2016 following "prolonged" challenges in the African aviation industry.
The African low-cost airline said challenging market conditions affecting much of the aviation industry on the continent have been "a lot more prolonged" than it had originally forecast, and therefore, results for 2016 will be "materially below" market expectations.
fastjet also no longer expects to be cashflow positive for the year, but said it has sufficient funds to meet its operational requirements, with over USD20 million of cash available at the end of February.
fastjet may consider raising further funds during the year to provide additional headroom and to ensure it has the necessary resources to fund future growth as market conditions improve, it said.
fastjet added that it has taken action to manage its operating costs and overheads and is implementing further measures including reducing capacity and rationalising the route network to align it with current demand.
"The company remains confident in its low-cost airline model and is well positioned to capture the significant growth potential of the developing African aviation market," fastjet said in a statement.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
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