airBaltic needs money again. The government promises to consider it 0 9

According to the agenda of the meeting, the government will discuss a report on the current situation at "airBaltic" in its closed session.

As reported by the Ministry of Transport, at the end of March, "airBaltic" approached the ministry, informing about the impact of external factors on the company's financial and operational activities. The military conflict in the Middle East has caused a significant rise in aviation fuel prices, increasing the company's expenses and affecting profitability.

Having reviewed the letter from "airBaltic" regarding the need for a short-term loan as one of the possible stabilization tools, Minister of Transport Aitis Švinklis proposed to consider this issue at today's government meeting.

He noted that it is important to ensure the continuous operational activity of the company during a period when external factors particularly affect the aviation industry.

The Ministry of Transport emphasizes that the company continues to operate flights, and a possible loan, if granted, will help maintain a stable route network, avoiding sharp changes and compensating for the pressure of rising fuel prices.

For safety reasons, "airBaltic" had previously been forced to temporarily cancel flights to Tel Aviv and Dubai, which reduced revenues and affected the efficiency of the route network. At the same time, aviation fuel prices have significantly increased due to the conflict in the Middle East.

As reported, the losses of the "airBaltic" group last year amounted to €44.337 million, which is 2.7 times less than in 2024. At the same time, the group's turnover increased by 4.2% compared to 2024, reaching €779.344 million.

In 2025, the airline transported 5.2 million passengers on its route network, which is 1% more than in 2024.

In August of last year, the German airline "Lufthansa" became a shareholder of "airBaltic". Currently, the state owns 88.37% of the shares of "airBaltic", "Lufthansa" holds 10%, financial investor Lars Tuessen through "Aircraft Leasing 1" owns 1.62%, and other shareholders hold 0.01%. The company's equity capital amounts to €41.819 million.

After the initial public offering (IPO) of shares, "Lufthansa"'s stake will be determined based on the potential market price of the IPO. The deal also stipulates that after the IPO, "Lufthansa" will own at least 5% of the capital of "airBaltic".

In August 2024, the Latvian government ruled that after the IPO, the state must retain at least 25% plus one share in the company's capital, and in August 2025, it was decided that the state, like "Lufthansa", would contribute €14 million to the capital of "airBaltic" before the potential IPO.

However, considering the financial results of 2025 and the market situation, "airBaltic" has suspended preparations for the IPO and is currently not considering it as a potential source of capital in 2026, according to the annual report of "airBaltic".

The document notes that despite the expected improvement in operational and commercial activities, the airline will have a negative free cash flow in 2026, and based on current forecasts, the company will require an additional infusion of funds ranging from €100 to €150 million to finance its activities in the winter season of 2026/2027.

The Minister of Transport indicated that the IPO is not the only way to attract capital, and the airline's management has been given the broadest mandate to seek funding opportunities using various financial instruments. Thus, the airline's task in 2026 is not only to reduce costs but also to attract capital.