In Dakar, the government allocated €68m ($81.9m) to national airline Air Sénégal, which is 100% state-owned.
However, Lomé, where Asky is based, did n0t provide the “pan-African company” with any money. As it is a privately owned company, Asky is left to its own devices in times of crisis.
However, it has sought help from the World Bank, African Development Bank (AfDB) and several banks. “We knocked on all the doors, undertook all possible and imaginable steps, but we haven’t yet found a solution,” says Nowel Ngala, the company’s commercial director.
Five months of quiet
However, Asky has indeed – like its colleagues on the continent – been hit by the health crisis, which has severely impacted the entire global airline industry. According to the International Air Transport Association (IATA), although African companies have demonstrated the greatest resilience in the world, their revenue per passenger-kilometre fell by 63.9% between January 2019 and January 2021.
The African Airlines Association (AFRAA) estimates that the continent lost $10bn over the course of 2020.
As for Asky, after almost no activity between March and August 2020 – during which only charter operations for the UN in West Africa took place, which involved mobilising three aircraft from Accra as well as cargo flights to bring Covid support equipment to West Africa – the company has recorded a timid recovery, operating at 27% capacity in September and October.
An “ongoing” request to shareholders
“We also had to adapt to the anti-Covid protocols put in place by various countries, review our flight plans according to the curfews introduced, reduce our number of flights to certain countries in order to respect their guidelines, such as Cameroon, Gabon and Nigeria… It wasn’t easy,” says Asky’s Ngala, who recently announced that activity fell by 48% from 2019’s levels.
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Despite these difficulties, and even though the IATA warns that the sector will probably not return to normal until 2024, the company’s management refuses to give up. And, while waiting for possible aid from public authorities and financial development institutions, Asky has sought help from its shareholders.
Several institutions are considering offering aid to Asky. These include Ethiopian Airlines, Ecobank, West African Development Bank and the ECOWAS Bank for Investment and Development, which each own 18% of the company. Several private investors – most of whom are African, including the South African investor Sakhumnotho Group Holdings, which was founded in 2000 to support the “Black Economy” – may also offer financial support.
Agile, but weakened
“Because of its private status, Asky is incredibly agile. Unlike Air Côte d’Ivoire or Air Senegal, where 20 people have to agree to any change, Asky can change its strategy overnight. When the situation demanded that it switch to cargo or stop serving South Africa all of a sudden over fears of its variant, it did so,” says an industry observer.
Consultant Sylvain Bosc, who advises several African states and international financial institutions, says: “Asky has a business model that is very well adapted to the region’s needs and has been managed prudently until now. It connects West and Central Africa.” He previously worked for Corsair, South African Airways and Qatar Airways.
Convinced that “this fine company deserves better than bankruptcy,” he nevertheless worries about its ability to overcome the crisis “as all its competitors are or will be largely supported by their respective shareholder countries.”
Funds for state-owned airlines
Abderrahmane Berthé, who is at the head of AFRAA, is trying to convince governments and development finance institutions to provide support to both private and public operators. “Providing financial support to the sector will ensure its survival,” he says, calling for subsidies, loans and loan guarantees, share issues, as well as deferring or waving airlines’ debts, rent, charges and taxes.
“For the moment, despite our calls to support private companies, the only funds released so far have come from governments and have been directed to national companies,” says Berthé, who explains that he has accompanied Asky in its dealings with the AfDB.
“We have also organised a webinar with Afreximbank and are proposing another with Africa Finance Corporation to put our members in touch with these institutions so that they can study possible solutions together,” adds Berthé, who hopes to hear concrete announcements from the financial institutions soon.
Optimistic about the future
However, even though he does not hide his concern about the crisis, Ngala is optimistic about the company’s future. At 10 years old, Asky is already one of the oldest players in the West African landscape. “I am confident about Asky’s future because we were on the right track. 2019 was the most profitable year in our company’s history, and we started 2020 with two equally promising months. This is what has enabled us – alongside the UN contract – to have made it until now without any redundancies or salary cuts,” he says.
The company was created in 2010 and recorded its first profit in 2015. This was “a year behind our initial projections because of the Ebola crisis,” says Asky’s commercial director. Then, after a difficult year in 2016 “due to a shortage of pilots worldwide, which made it impossible for us to operate all the flights we had scheduled,” the company became profitable once more from 2017 to 2019, growing each year by 3% to 5% until it reached a turnover of 95bn CFA francs.
The company, which has 475 employees of 32 different nationalities and already operates a route to New York thanks to its partnership with Ethiopian Airlines, had also planned to connect to Europe and the Middle East in 2019. “The project itself is not in doubt, but this period is not conducive to conquering new markets. We will first consolidate our current routes,” concludes Ngala.
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