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El Al Airlines posts second-quarter loss as coronavirus halts flights

FILE PHOTO: El Al Israel Airlines planes are seen on the tarmac at Ben Gurion International airport in Lod, near Tel Aviv, Israel March 10, 2020. REUTERS/Ronen Zvulun/File Photo

JERUSALEM (Reuters) - El Al Israel Airlines swung to a loss in the second quarter with commercial operations still suspended due to COVID-19, while cargo flights and cutbacks were unable to offset the loss in revenue from passenger flights.

Israel’s flag carrier said it is preparing for a $150 million share offering as part of a bailout that would give it access to $250 million in government-backed loans. The state will buy the shares if no-one else does in a public offering.

With no passenger flights and most of the its workforce on unpaid leave, El Al said it has taken measures to boost its balance sheet, including cancelling leases on planes, cutting salaries, selling assets and spare parts, and fitting passenger jets for cargo flights.

The company said it lost $105 million in the April-June period, versus a $100,000 profit a year earlier. Revenue plummeted 74% to $152 million.

“The company’s activity is dependent on the ability of countries to overcome the virus, restoring customer confidence and security in flying and state assistance. We all hope that will happen quickly,” said CEO Gonen Usishkin.

Reporting by Ari Rabinovitch; Editing by Steven Scheer