DOHA (AFP) - Qatar Airways said Sunday (Sept 27) it received US2.0 billion (S$2.76 billion) in state aid to weather the coronavirus crisis, as it posted huge annual losses after enduring one of its "most difficult years".
The firm said that the combination of the coronavirus pandemic, a boycott by Gulf neighbours and the liquidation of 49 per cent-owned Air Italy - which announced its bankruptcy in February - had resulted in a near doubling of losses.
This brought the carrier's net loss for the year to end-March to 7.0 billion riyals (S$2.57 billion).
"Qatar Airways is familiar with facing exceptional challenges; however, 2019-20 has been one of the most difficult years in the airline's history," the carrier said in a statement.
The airline confirmed that Qatar had joined a list of governments that have stepped in to support their national carriers through the coronavirus shutdown, which has pummelled global travel and the aviation industry.
The carrier will issue 730 million shares to the government after receiving "an advance of 7.3 billion riyals" after annual losses exceeded 50 per cent of share capital, it said in its annual report.
"If not for the exceptional circumstances of fiscal year 2020, our results would have been better than the year before," said the airline's chief executive, Akbar al-Baker.
The report also said that over the 12 months, revenue increased 6.5 per cent to 51.1 billion riyals, seat capacity increased by 3.2 per cent, and freight handled rose by 2.8 per cent.
The pandemic compounded an already difficult environment for Qatar Airways. The United Arab Emirates, which was a key market for the Gulf carrier, along with Saudi Arabia, Bahrain and Egypt, have enforced a boycott of Qatar since June 2017.
They accuse Doha of links to extremist groups and being too close to Iran, Riyadh's regional arch-rival - charges Qatar denies - and have closed their airspace, borders and markets to Doha.
Qatar Airways is the second largest airline in the Middle East after Dubai-based Emirates, operating a modern fleet of 250 aircraft - although some remain grounded during the pandemic.
Qatar in July won a ruling at the International Court of Justice in its fight against airspace restrictions by Saudi Arabia, the UAE, Bahrain and Egypt.
It said it will seek US$5.0 billion in compensation from the other Arab states for closing their airspace to the flag carrier.