Swiss national airline loses 200 million Swiss francs in 1st quarter

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Swiss national airline loses 200 million Swiss francs in 1st quarter

BASEL, Switzerland (AP) =97 Switzerland's national airline Tuesday announced=
=20
it lost 200 million Swiss francs ($155 million) in the first quarter and=20
said that "further drastic" cuts would be needed. "The results reflect the=
=20
extremely difficult economic environment currently affecting all airlines,=
=20
a situation which has been exacerbated by the war in Iraq and the SARS=20
virus," said Swiss International Air Lines, or Swiss. The results were=20
little changed from a loss of 199 million Swiss francs for the three months=
=20
ended March 31 a year earlier. The airline, which was formed with the help=
=20
of the Swiss government in March 2002 on the foundation of the collapsed=20
Swissair, said its revenues increased to 1.04 billion francs ($812.5=20
million) from 489 million francs during the same quarter a year earlier.=20
Swiss, which plans to cut costs by 600 million francs ($468 million) this=20
year, said, "In view of the current situation affecting the air travel=20
industry, further drastic cost-cutting measures will have to be=
 implemented."

The company has made similar announcements earlier this year without being=
=20
very specific. Swiss media reported over the weekend that Switzerland's=20
flag carrier may cut as many as 3,000 jobs and reduce its long-haul fleet=20
to 18 planes from 26 as part of its announced restructure. By the end of=20
March, the payroll had been reduced to 10,521 employees from 10,606 at the=
=20
end of last year. The company said its liquidity stands at 913 million=20
francs ($713 million), and that shareholders' equity stands at 1.49 billion=
=20
francs, adding that it expects to reduce the rate at which it uses cash in=
=20
the next few months. The company posted a net loss of almost 1 billion=20
francs in 2002. It hopes to break even next year at the earliest. Its fleet=
=20
of around 110 aircraft is considered too big =97 and the airline too=20
unprofitable =97 for it to join a major airline association, such as=
 OneWorld=20
alliance, led by U.K. British Airways PLC and AMR Corp.'s American=20
Airlines. The company has reportedly been in talks with Germany's Deutsche=
=20
Lufthansa AG.

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