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SAS losses widen in 2010

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SAS losses widen in 2010
07:46 CEST+02:00
SAS Scandinavian airlines' losses continued to widen in January and February, the company said Tuesday as it prepares for a new €510 million rights issue to bolster its ailing finances.

In the first two months of 2010, SAS's net loss before taxes widened to 960 million kronor ($135.2 million), compared to 420 million a year ealier, the company said in a preview of results to be published next month.

Sales meanwhile plunged 16 percent to $5.89 billion, dragged down by a drop in passenger numbers.

"The pressure on passenger yield continued to be significant and the yield for Scandinavian airlines (adjusted for currency effects) decreased by 12.2 percent compared to the same period in 2009," the company said.

According to analysts surveyed by Dow Jones Newswires, those results are near expectations.

Shares in SAS were up 0.71 percent to 2.84 kronor at 4:00 pm on Tuesday on a flat Stockholm Stock Exchange.

SAS announced a new 5.0 billion kronor ($688 million) rights issue in February to help it through its financial difficulties.

The terms of the issue will be made public on April 6.

SAS had already issued new rights worth 6.0 billion kronor in the first half of 2009.

The company is set to publish its complete earnings for the first quarter of 2010 on April 22nd.

It said it expects to post a loss of 1.0 billion kronor, in line with a cost reduction plan, which aims to save 7.8 billion kronor by slashing 4,600 jobs, 3,100 of which have already been cut, the company said Tuesday.

SAS, in which Norway, Denmark and Sweden together hold half the stock, has

been hit by the rise of low-cost airline Norwegian and the plunge in passenger

traffic numbers as a result of the global economic crisis.

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