According to the annual report for last year, the largest company in tourism in the Czech Republic and Slovakia is in danger of not coping with the consequences of the coronary crisis. According to the document, the group could need a financial injection already in September, even if it will not be able to open mountain resorts, amusement parks or hotels until then.
“Although management considers this scenario highly unlikely, these events would create significant material uncertainty for the company, which could fundamentally call into question the company’s ability to continue as a going concern,” the report said, adding that the company would not have to meet its obligations.
TMR’s main shareholder Igor Rattaj moderates the report. According to him, it is a very conservative assessment of the most pessimistic scenarios. “Bondholders and shareholders are holding us. There are no dramatic scenarios. In the Czech Republic and Slovakia, we are negotiating state aid, to which we believe we have both a legal and a moral right, “Rattaj told the daily E15.
According to the annual report, the group reported a loss of more than 22 million euros, about 585 million crowns, which is ten times more than the year before. Due to poor results, TMR had to cut costs to a minimum and in January announced that it would lay off 260 employees in Slovakia, approximately a quarter of the local employees. The director of the Association of Mountain Resorts Libor Knot believes that a number of other ski resorts will follow suit.
Exceptions may be centers with a very strong capital base, which are not burdened with debts from the past. These include the Kopřivná pod Pradědem ski resort, which has been profitable so far.
“Without the help of shareholders, we would not be able to finance all liabilities. In total, we lost approximately 60 million crowns in revenues, ie two thirds of last year’s income, “says Karel Ležatka, chairman of the complex’s board of directors, whose half shareholder is billionaire Petr Otava.
According to Knot, lost sales of ski resorts in the whole of the Czech Republic can climb to three to four billion crowns for the whole season. “The problem is further exacerbated by the fact that the areas, which in terms of sales represent over half of the market, have already exhausted the maximum amount of cumulated support by the end of 2021, which is 1.8 million euros, about 47 million crowns,” Knot added.
Compensation from the new COVID – Sport III program, which will start paying off next week, will help only parts of the operators. If the government does not use other permitted forms of support for any of the newly prepared programs and does not increase the drawdown limit, it will be fatal for some companies, according to Knot.
We do not know of any bankruptcies yet, but it is clear that corporate debts are growing. They will solve this with loans or they will have to invite co-investors. Compensation for half the costs is a good basis, but only a minimum of them will suffice, “says Knot.
According to the Association of Mountain Resorts, there are 450 ski resorts in the Czech Republic. They were only allowed to operate this season between December 18 and 26, and they consider the season over. Some still hope that skiers will be able to let them go down the slope at least in April.