Israeli carrier El Al profit slumps, working on recovery plan

JERUSALEM, March 25 (Reuters) - The coronavirus pandemic led to a huge loss at El Al Israel Airlines in the final three months of 2020, and the airline said it was working on a recovery plan to emerge from the crisis.

Israel’s flag carrier said on Thursday it lost $140 million in the October-December period as it operated just a handful of flights, versus a net loss of $31.5 million a year earlier. Revenue fell to $111.6 million -- $73 million coming from cargo activities -- from $518 million.

For all of 2020, when COVID-19 closed Israel’s borders to foreigners and significantly curtailed the carrier’s operations, El Al’s loss swelled to $531 million from $60 million in 2019.

Last week, Israel’s government agreed to a $210 million bailout of El Al which changed hands in late 2020 and was forced to slash one-third of its staff, or 2,000 workers, and other costs. The state also required new owner Eli Rozenberg to inject more cash into the airline.

El Al, which also has a new board and management, has reported losses for two years and racked up debt to renew its fleet. It suspended scheduled passenger flights last March at the outset of the health crisis when Israel closed its borders to most foreign citizens, compounding its financial woes.

Israel has begun to open up some international routes again to its citizens but on a limited basis, citing concerns over new coronavirus variants but it was unclear when tourists would be allowed to return.

CEO Avigal Soreq said that along with the implementation of an efficiency plan and a gradual increase in operations in 2021, the airline was working on a multi-year plan to emerge from the crisis.

El Al “forecasts a return to a scope of business activity in 2022 that will yield a positive cash flow, followed by implementation of a business plan for long-term growth and profitability,” Soreq said.

Reporting by Steven Scheer Editing by Alexandra Hudson