[Yonhap News Photo]
South Korea's second largest carrier Asiana Airlines said Friday that its board approved a plan to raise cash reserves and reduce debt through the sale of non-core assets including Kumho Terminal.
Asiana said it would sell a 100 percent stake in Kumho Terminal and a 50-percent stake in Kumho Asiana Plaza Saigon, a hotel and office operator in Vietnam, for a total of 393 billion won (343 million US dollars). The sale will help Asiana collect a profit of 56.1 billion won.
The move came after Asiana saw its worst-ever year in 2015, hit by a sharp fall in air travel and tough competition with budget carriers. It reported a net loss of 81.5 billion won last year, a turnaround from a profit of 63 billion won a year ago.
Its balance sheet improved this year thanks to low oil prices, improved passenger flight rates, and rising air traffic, but analysts painted a gloomy long-term outlook for Asiana despite its continued efforts to reduce cost and debt.
Asiana's share in domestic lines fell to 18.8 percent last year. Asiana plans to launch a second budget carrier in addition to Air Busan, but commercial service may not be possible within the first half due to delayed endorsement from aviation authorities.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
