Just months after exiting bankruptcy proceedings, Spirit Airlines is facing a serious cash crunch.
In a ‘going concern’ notice, it warned it has to raise more cash or it might not survive long.
It cut debt during its recent restructuring and announced plans to furlough hundreds of pilots and other staff.
However, in a filing it said this may not be enough to save the airline long term.
In the note to investors its survival was currently in serious jeopardy and its future is in ‘substantial doubt’ beyond the next 12 months without fresh funding.
The airline exited bankruptcy by turning almost $800 million in debt into equity.
This was supposed to give a stable platform to improve its fortunes ahead of the busy summer period.
There is ‘elevated domestic capacity; along with weakening demand for no frills air travel, it says.
The airline’s credit card processor has also demanded more collateral to continue its partnership due to its previous financial issues.
