Grounded carrier Kingfisher Airlines' decision to consider it a 'going concern' entity, despite having accumulated huge losses and defaulted on loans, has come for a sharp criticism by its own auditors, given a lack of clarity about its revival plans.
Banks take possession of Kingfisher House in Mumbai
At the same time, the auditors of Kingfisher's parent entity, United Breweries (Holdings) Ltd, have also expressed their concern over the company's significant exposure to the airline, which has been grounded for about 10 months now and its flying permit also lapsed long ago.
Have no money to pay you, Dr Vijay Mallya tells striking Kingfisher Airlines staff
Part of Vijay Mallya-led UB group, Kingfisher has never reported a full-year profit as yet, its accumulated losses have crossed Rs 17,000 crore, net worth has been completely eroded and lenders have recalled loans totalling more than Rs 6,000 crore after repeated defaults.
In their latest 'review report' presented to Kingfisher's board, the auditors said: "These events cast significant doubt on the ability of the company to continue as a going concern".
In accounting parlance, 'going concern' entities are generally those that function without any threat of liquidation in the foreseeable future.
The auditors said that Kingfisher continues to prepare financial results on a going concern basis "notwithstanding the fact that the company's net worth is completely eroded, the scheduled air operator's permit issued by the Director General of Civil Aviation has lapsed and the consortium of banks have recalled their debt to the company."
They further said that the appropriateness of this 'going concern' basis is inter-alia dependent on the company's ability to obtain renewal of its flying permit, infuse requisite funds for meeting various obligations, rescheduling of debt and other liabilities and resuming normal operations.
India's grounded Kingfisher Airlines net loss widens
Grounded Indian carrier Kingfisher Airlines Ltd reported on Wednesday yet another quarterly loss as it had no income from operations. Cash-strapped Kingfisher ...
UPDATE 1-Grounded Kingfisher Airlines posts further $189 mln loss
NEW DELHI, Aug 14 (Reuters) - Cash-strapped Indian carrier Kingfisher Airlines, which has been grounded for nearly 10 months, reported yet another quarterly ...
Kingfisher's Q1 loss doubles on aircraft re-delivery cost
Moneycontrol.com
In a filing to the exchanges, Kingfisher Airlines said, it is making all efforts to resume operations but did not mention how soon it will be able to do that. Source:
Kingfisher's Q1 net loss widens to Rs 1156.91 cr
Mumbai: Kingfisher Airlines, grounded since October last year, on Wednesday reported net loss at Rs 1,156.91 crore for the quarter ended June 30, 2013.
See all stories on this topic »
Kingfisher's Q1 loss doubles on aircraft re-delivery cost
Kingfisher has not flown since October 2012 for want of cash
* Lenders, owed more than $1 bln, took possession of Mumbai property
* Kingfisher says still exploring options to recapitalise, resume ops (Adds company comments, details)
By Devidutta Tripathy
NEW DELHI, Aug 14 (Reuters) - Cash-strapped Indian carrier Kingfisher Airlines, which has been grounded for nearly 10 months, reported yet another quarterly loss on Wednesday, with no income from operations and creditors seeking to sell off assets.
Kingfisher, once India's second-biggest carrier, owes more than $1 billion to a consortium of mostly state-run banks and hundreds of millions of dollars more to airports and tax authorities and others.
After its flying licences expired last year, Kingfisher, controlled by prominent industrialist Vijay Mallya, has twice submitted revival plans to the regulator in bids to restart operations, but the authorities are yet to be convinced.
Last week lenders took possession of a key real estate company in Mumbai, but the property is estimated to be worth only about $15 million and auctioning it will not be easy due to pending legal issues.
The banks, which have so far recovered about $90 million of the loans do not expect to recover much by selling shares and property pledged against loans taken by Kingfisher, the head of top Indian lender State Bank of India said in February.
Kingfisher reiterated on Wednesday that it was in talks with prospective investors and was exploring various options to recapitalise and resume operations. It will also ask lenders at an appropriate time for a debt restructuring, Kingfisher said in a filing to the stock exchange.
A fully-funded turnaround of Kingfisher would cost at least $1 billion, consultancy Centre for Asia Pacific Aviation has estimated.
Kingfisher, which had never posted a profit in its eight years of operation, reported a net loss of 11.57 billion rupees ($189.4 million) for the three months to June, compared with a net loss of 6.51 billion rupees a year earlier, but lower than a record 21.42 billion rupees loss for the March quarter.
Shares in Kingfisher hgave lost nearly three quarters of their value this year and currently have a market capitalisation of just over $50 million. ($1=61.0850 Indian rupees) (Additional reporting by Swati Pandey in Mumbai; Editing by Greg Mahlich)
In a filing to the exchanges, Kingfisher Airlines said, it is making all efforts to resume ... Debt-ridden Kingfisher Airlines ' June quarter loss almost doubled to Rs
Shares pledged by Mallya, group firms in United Breweries up 69%
Business Standard
UB Group Chairman Vijay Mallya, who is battling high debt across his group companies, primarily Kingfisher Airlines, has reported a 69 per cent rise in the
See all stories on this topic »
Business Standard
Kingfisher's Q1 net loss widens to Rs 1157 cr
The consortium has taken possession of Kingfisher House, the corporate office of now defunct Kingfisher Airlines which owes about Rs 7,000 crore to its lenders.
Kingfisher Q1 net loss widens to Rs 1156.91 crore
UB group company Kingfisher Airlines (KFA) reported net loss of Rs 1,156.91 crore for the first quarter ended June 30, 2013, from net loss of Rs 650.78 crore a ...
Mallya's pledge of UBL shares increase by 69%
Vijay Mallya, who is battling many a fire across his group companies over high debt issues primarily involving Kingfisher Airlines, has reported a sharp 69% ...
PILOT’S CAREER GUIDE
Rating: Not yet rated.
Published: July 13, 2013
Words: 25,040 (approximate)
Language: English
ISBN: 9781301650040
SHORT DESCRIPTION
International Airline Pilot’s Career Guide Learn Step By Step How to Become an International Airlines Pilot By Shekhar Gupta And Niriha KhajanchiEXTENDED DESCRIPTION
1. Your Aviation Career Starts Here2. Pilot Training
3. Flight Ratings – SPL, PPL, CPL, ATPL
4. Pilot and Personal Computer
5. Medical Requirements for Pilots
