In spite of the impressive picture painted about the national airline, Ghana Airways (Ghanair), in its operations by the company's management headed by Mr. E.L.Quartey Jnr, Chronicle's investigations into the financial position of the company indicate that Ghanair is grinding to a halt.
According to documents available to the Chronicle, Ghanair consistently registered a loss of about $36 million (equivalent to ?252 billion) between 1999 and 2000. In 1999, the company made a loss of $18 million, while last year they made another loss of $18 million instead of a targeted profit of $ 3.4 million.
The gloomy state of the company's finances and consistent losses, incurred within the year under review, were captured in a memo dated March 29, 2001 sent to Ag. Chief Executive, Mr. Owusu, from the Deputy Chief Executive (Finance & Administration), Alex Sykes.
In 1999, the Board of Directors of Ghanair even rejected the completed, but not audited, accounts of the company and invited Arthur Anderson, a private consultant, to investigate the accounts. The consultant discovered a loss of $18 million.
A year after (that is 2000), the financially tumbling Ghanair again recorded a circa $18million.
Insiders say that if measures are not put in place by the government to salvage the company from the financial predicament that the former Chief Executive, Quartey, Jnr, has plunged the company into, the nation may wake up to realise that the only national carrier has collapsed.
Ironically, while the company was struggling to find its feet, the former Chief Executive and other top members of the company were earning about $7,000 a month on the average.
Meanwhile, the airline may need about $10million, equivalent to about ?70 billion to stay in business. Last month, the company had to struggle to pay its staff in Ghana.
Chronicle investigations indicate that as at March 31, this year, bank loans, other loans and trade creditors of Ghanair stood at $102,403 million, about ?716.8billion, using today's exchange rate of ?7,000 per a dollar.
This year, figures from the Finance Department have predicted that Ghanair will incur a loss of $15 million if they continue with the reckless operations.
But the former Chief, Mr. Quartey, who bowed out of office about two months ago, led management to reject these realities and went ahead to amend the 2001 budget to suit their whims and caprices.
The concocted budget now predicts an operational profit of $1.7million, which some members of the management team say is unattainable.
Two months into the year 2001, Ghanair is already trailing behind its target of $30milion for the past two months, as only $19.4 million was realised.
The facts are that for about three years, the weekly cash outflows have shot higher than the inflows. Currently the company has overdrawn all its bank and cash balances.
As at the time of filling this story the company's overdraft stood at $1.4million.
This troubling situation comes at a time when management has been propagating a rosy picture about the company's success through very expensive advertisements.
Ghanair managed to stay in business in the wake of the mismanagement or shortfall under Quartey Jnr's, administration through bank loans, non-payment or delayed payment of their creditors, the disposal proceeds of the company's assets and investments, and moreover the forward use of the future operational income of the company.
"Ghanair has exhausted all its sources of financing and has resorted to writing to their creditors to re-schedule the payments but to be sincere most of the creditors have run-out of patience," sources close to some of the foreign creditors told Chronicle.
Ghanair has found itself in this mess due to questionable transactions and mismanagement of the place by Quartey Jnr, who resigned two months ago to save himself from embarrassment.
"The problem that we encountered was that the out-gone Chief Executive was not prepared to face the realities of the day, but rather preferred to doctor documents to throw dust into the public eye", a staff, pleading anonymity said, adding "how can an airline which we were all aware was shouldering heavy liabilities win several awards for effective operations?"
When the Chronicle contacted the Acting Chief Executive, Mr. Owusu, and Mr. Alex Sykes, the Acting Deputy Chief Executive (Finance and Administration), they both admitted that the company was in some sort of financial trouble but they were putting their act together to sustain it.
Mr. Owusu stated that he was new to some of the serious issues raised by the paper and asked for time to turn things around.
"We have found ourselves in this mess because of lack of proper management that the company had experienced under the leadership of the out-gone Chief Executive, who became a tin-god in the system and refused to listen to genuine advice from some of us who knew the in-and-out of the Airline industry," an expert in Airline industry told Chronicle in a chat.
Over-reliance on first generation and outmoded aircraft, such as DC10s and DC9s, which are noted for high and uncontrollable fuel consumption, instead of going in at least for Boeing equipment that other competitors are using have also contributed to the current state of the airline.
Another added that the airline is losing a lot of revenue in the recruitment and maintenance of 20 expatriate pilots, (14 Venezuelans and 6 Yugoslavs). Ghanair has spent over $1 million as salaries and hotel accommodation on these foreign pilots.
Since there are no planes to fly, these expatriate pilots are virtually on holiday but at the end of every month each one of them takes $6,000 as salary.
Chronicle has learnt that the pilots are housed at M Plaza Hotel, while Ghanair pays about $120 a night for a room.
A number of staff who spoke to Chronicle on condition of anonymity called for a proper probe into the operations of the airline since 1996. "Some of us were aware that the airline was being pushed from the business but the management who should have known better decided to paint a different picture that all was well with the company," a staff member said, adding that the company is a national asset, and as a result some few people should not be allowed to bleed the company white and get away with it.
"All those who have contributed to the predicament of the airline should be brought to book, period," another aggrieved staff told Chronicle. Stay tuned.
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