African low-cost airline Fastjet is facing a race against time to secure its future.
The carrier said last month (September 26) it would need to find additional funding by the end of October to keep flying.
In an update issued to the stock exchange on Wednesday morning (October 31), Fastjet said it would be able to continue operating beyond the end of October “due to some improvement in trading and cash generation”.
However, the airline warned it nonetheless still needed to reach an agreement with its key creditors “in the coming days” or cease trading.
The company continues to review its current cash requirements and is able to continue operating beyond the end of October due to some improvement in trading and cash generation,” it said.
“The headroom available allows the company further time to continue discussions with its major shareholders and creditors.
“In conjunction with fundraising discussions, the company has been negotiating with key creditors to reduce outstanding balances due to be paid and reduce the burden of interest and capital repayments. This process remains ongoing.
“While discussions to date with certain shareholders and creditors have been positive, discussions are ongoing and there can be no guarantee of a successful outcome. If the company is unable to carry out an equity fundraise and/or reach an agreement with its key creditors in the coming days, the group would be unable to continue trading as a going concern.”
Tanzania-based Fastjet operates out of three bases flying to 13 destinations in Tanzania, Zambia, Mozambique, Zimbabwe and South Africa.