FBiH Government on BH Airlines: Negotiate with Mitteldeutsche to resolve employee status

The Government of the Federation of Bosnia and Herzegovina at today's session adopted the Information on the situation in JP BH Airlines and negotiations with representatives of Mitteldeutsche Tourismus Entwicklungsgesellschaft mbH, reports the Patria news agency.

The Federal Ministry of Transport and Communications and the Federal Ministry of Finance were instructed to, in cooperation with the Office of the Prime Minister of the Government of the Federation of Bosnia and Herzegovina, continue negotiations with representatives of this company with the aim of establishing an airline company that would resolve the status of BH Airlines employees.

- BH Airlines is in a very difficult financial situation that has lasted for many years. The audit report for 2013 concluded that the company cannot settle its long-term obligations from fixed assets and that without significant assistance it will not be able to maintain business continuity.

A representative example of negative operations can be seen in the fact that B&H Airlines from 2005 to 2014 generated 99,197,507 KM in losses, including 13,605,181 KM in 2013 alone, and another 12,740,986 KM in 2014. At the end of 2014, the accumulated uncovered loss of the company amounted to 39,773,272 KM and increased further in 2015, while at the same time total subscribed capital amounts to 18,773,272.70 KM – announced from the FBiH Government.

In the balance sheet as of December 31, 2014, a loss above the amount of capital of 20,011,970 KM was reported, and it is evident that creditors can no longer be settled from the company's capital and that a carefully planned and executed restructuring process is necessary to ensure business continuity.