Firms Up Commitments To 88 A320neo Airplanes

As part of the implementation of the "Avianca 2021 Plan", Avianca management has reached several agreements to tailor its aircraft commitments to its future requirements.

In cooperation with Airbus, the Company has reduced its firm commitments to 88 A320neo aircraft (from 108). Previously scheduled firm A320neo family deliveries in 2020 through 2024 have been deferred or cancelled. The 88 remaining commitments are now scheduled for delivery in 2025 through 2028 (20 per year) with the balance in 2029.

These agreements provide comprehensive financial benefits, with significant Capex reduction in the period through the end of 2024.

Separately, Avianca has agreed to enter into 12-year operating leases for up to 12 A320neo aircraft with BOC Aviation Deliveries to occur after 2023, consistent with the Avianca 2021 plan.

Finally, Avianca reached a mutually beneficial agreement with Boeing with regards to the outstanding 787-9 deliveries CFO Adrian Neuhauser said "The completion of these three major aircraft transactions, coupled with the recently completed financial reprofiling and securing of $375 million of new long-term capital financing, places Avianca in a solid position as it moves forward with the Avianca 2021 Plan."

(Source: Avianca Holdings news release. Image from file)

FMI: www.avianca.com