Alitalia first half net loss narrows

Italy's struggling national carrier Alitalia said its net loss narrowed marginally in the first half of the year but it still has enough cash reserves to keep flying for another year while new management seeks a buyer.
The airline, which is 49.9-percent state-owned, said its first-half net loss was 211.1 million euros (293.8 million dollars), a slight narrowing from the 220.2-million-euro loss reported in the same period a year earlier. It said in a statement issued on September 12 that first-half revenue edged up 3.1 percent to 2.31 billion euros from 2.24 billion euros a year earlier, but operating costs grew 3.0 percent to 2.44 billion euros from 2.37 billion.
The Rome-based company did not comment on progress in new chairman Maurizio Prato's search for a buyer in the wake of the government's failed attempt to auction its stake earlier this year.
Alitalia on September 12 denied Italian press reports that it was in high-level talks with Air France-KLM, which has often been put forward by analysts as a likely buyer for the company.
Prato said earlier this month that, in association with the airline's financial adviser, Citigroup, he intends to sound out all potential suitors by the end of September. These include private equity house TPG, privately owned Italian airline Air One, and Russian flag carrier Aeroflot, all of which have previously expressed interest in the airline.
Alitalia's plight has been exacerbated by the rapid growth of low-cost carriers like Ryanair and easyJet, and by persistent labour unrest, as powerful unions seek guarantees over future staffing despite management's attempts to broach the issue of restructuring.
Alitalia reported last month that the company's net debt was 1.05 billion euros at the end of July, while its market capitalisation has slipped about 20 percent since the start of the year to just under 1.2 billion euros.
The restructuring programme also includes a plan to downsize operations at Milan's Malpensa airport, but some sector analysts have warned that this may put off potential buyers. Alitalia and Air France-KLM are already linked by cross ownership stakes of two percent each.