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NCAA Makes Loss of N$84 Million … but remains in a strong liquidity position

By:Justicia Shipena
State-owned regulatory and air traffic services organisation, Namibia Civil Aviation Authority (NCAA), incurred a net loss of N$84 million during the 2021/22 financial year, according to the authority’s latest integrated annual report.
“The authority has incurred an accounting loss of N$84 million for the year ended 31 March 2022. This is partially offset by N$56 million in government operational financial support,” said the report.
The report further said revenue from the industry started to recover, with overall revenue recorded having increased from N$45 million to N$ 102 million in the period under review.
“The trend continues to be observed in the 2023 financial year. There were no changes to the fees and charges during the year ended March 2022,” the report stated.
“Operating expenditures increased by 23% during the current year when compared to the prior year, mainly due to an increase of 8% in staff, as a result of critical positions having been filled in the current financial year , as well as the implementation if salary corrections.”
Furthermore, the authority experienced a drastic increase in bad debts by 55% as a result of the movement in the provision for doubtful debts due to the airlines’ increase in credit risk, especially Air Namibia which has been fully provided for.
The report showed that there was also a drastic increase in depreciation from N$14 million to N$41 million as a result of the transfer of assets from government that were depreciated over the full 12-month period, and the resulting valuation thereof.
In addition, the statement of financial position showed a reduction in total net assets from N$ 580 million to N$547 million mainly due to the depreciation charged during the year.
“NCAA remains in a strong liquidity position,” the report stated.
In his foreword to the annual report the line minister of works and transport John Mutorwa, said despite economic slowdown partly brought about by COVID-19, the Namibia government continued to invest in aviation infrastructure.

This year saw the alleviation of congestion with the terminal building at Hosea Kutako International Airport and to ensure that it meets safety compliance standards.

The expansion project included the expansion of checking in counters to 18, immigration counters and screening points to five, and doubling the airport’s capacity with respect to airport facilitation.

Mutorwa said special helicopter operations were used as means of transport to oil rigs in Namibian waters which led to the discovery of oil.
“With our speedy approval special request, we are proud to have contributed in one way or the other to the discovery of oil in our waters,”said the minister. This has the potential to impact the expansion of aviation infrastructure and increase air connectivity, he pointed out.
“I am happy to report that aviation safety and security have been maintained throughout the country for both international and domestic air operators,” he reiterated.
NCAA chairperson Bethuel Mujetenga said despite the net loss of N$84 million, the authority’s financial fundamentals remain strong with N$504 million in net assets.
Mujetenga said the economic impact of the global was heavily borne by airlines, especially Air Namibia, which was liquidated, as well as travel agents, airports, and aviation in general.
“Despite the decline in aviation activities which in turn resulted in a decline in revenue, the NCAA was able to provide essential services comprised of air traffic control at eight major airports, aeronautical information services, calibration of equipment, and statutory regulatory oversight functions,”he said.
Mujetenga said through strict cost controls and financial planning, NCAA was able to survive the challenging period experienced by the aviation industry due to COVID-19.

Justicia Shipena

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