LAS VEGAS, NV (SEP 4) - National Airlines announced that it has reached an agreement for a financing package valued at approximately $112 million. Included in this package is a debt-for-equity exchange that will substantially reduce the Company’s debt load, plus an infusion of new cash equity. With these achievements, the Las Vegas-based carrier now expects to successfully emerge from reorganization protection in early October, pending final documentation, modification of the Company’s previously confirmed Plan of Reorganization, and court approval.
Michael J. Conway, president and CEO for National, said, “This entire financing package is the result of thousands of hours spent by not only National’s management, but by our aircraft lessors and other major creditors as well. Without the cooperative participation of all parties, including the employees of National, this financial package would not have been possible.” Conway added, “As a result, almost 300,000 monthly passengers will continue to experience the quality service and affordable fares offered by National.
Conway noted that in addition to the financing package, National has achieved reductions in its annual cash operating expenses of approximately $50 million through re-negotiated aircraft lease rates, contracts with other major vendors, and employee pay reductions. “This is truly an example of everyone stepping up and doing what is necessary to ensure not only National’s survival, but to position the Company for long-term success.” The CEO said that National’s employees have incurred pay reductions since last September; the reductions will continue for varying lengths and amounts, with the most significant burden borne by the management and the pilot group.
“I’d like to express my thanks to the employees of National. None of this would have been possible without their continued support. Their dedication and tenacity in the face of adversity is a true reflection of their commitment. My gratitude also goes out to National’s aircraft lessors, Harrah’s Entertainment and other key creditors, who have supported National throughout the reorganization process and have recognized the potential of National in the rapidly changing US airline environment. Of course, the unwavering support of our loyal and growing customer base and our travel agent partners cannot be overemphasized.
“This financial package displays the support the private sector has shown for our business plan and their recognition of the evolution of the airline industry toward efficient, low-fare carriers. Unfortunately, the Air Transportation Stabilization Board (ATSB) failed to recognize this dynamic change in the industry when they rejected National’s loan guarantee application.
“The ATSB has sent a clear signal that they are committed to perpetuating certain high-cost, high-fare major airlines, which runs completely counter to the preferences being made by the traveling public. We understand that there is a possibility that Congressional hearings may be held to look into the ATSB process. We would strongly support any such action by Congress to thoroughly review the ATSB process, a process National believes is wrought with conflicts of interest and bias. National is fully prepared to provide sworn testimony on its experience with the ATSB should the hearings take place.” Conway added, “Despite our view of the ATSB process, National has the support needed to successfully reorganize, and we are prepared to move forward. Our low cost structure, combined with our quality product have clearly been a favorite among travelers.”
The CEO noted that National has been recognized for outstanding customer service by Conde Nast Traveler magazine’s “2000 Reader’s Choice Awards,” “2001 Zagat Airline Survey,” and most recently Travel & Leisure magazine’s “2002 World’s Best” survey.
National Airlines operates an all Boeing fleet of (18) 757 jet aircraft configured with 175 seats including 22 in First Class. The carrier plans to add two additional B757s by the first quarter of 2003, and several more aircraft by the end of 2004, market conditions permitting. National serves major cities to the east and west of its Las Vegas hub. National reaffirmed its plans to begin new service at Reno/Tahoe on October 3rd and new seasonal service at West Palm Beach on November 21st. The carrier will also add a third daily flight to Miami on November 21st.
Reservations can be made through a travel agent or the National Airlines Reservations Center at 1-888-757-5387. To take advantage of the Web-only additional discount, purchase your travel at nationalairlines.com. And for great deals on a complete Las Vegas, Reno/Tahoe air-and-hotel packages, call National Airlines Vacations, the Las Vegas experts, at 1-888-LAS-TOUR (527-8687).