Air Macau (NX, Macau International) has reduced its registered capital by MOP1.4 billion Macanese patacas (USD173.4 million) to abide by local laws that require an entity's total equity to be not less than half its registered capital.
The news accompanied the airline releasing its 2022 financial results via Macau's official government gazette on June 14. Air Macau reported a loss of MOP1.02 billion (USD126.3 million) for the 12 months to December 31, 2022. Accumulated debts stood at MOP2.8 billion (USD346.9 million) at the end of the year, while the net assets figure was MOP1 billion (USD123.9 million). The airline's chairman, Wang Mingyuan, attributes the less-than-stellar financial results "to the impact of the resurgence of the epidemic and the increase in oil prices."
"On December 13, 2022, the company decided, in an extraordinary general meeting convened for this purpose, to reduce its share capital, motivated exclusively by losses, which reduction included the elimination of the aforementioned special reserve of MOP200 million (USD24.8 million)," the gazette notice read. "The extraordinary general meeting approved the proposal to reduce the share capital by MOP1.4 billion to offset losses, ensuring that the company's shareholders' equity is not less than half of the share capital, to avoid the occurrence of the situation provided for in article 206."
Article 206 of the Macau Special Administrative Region Government states that when a company's shareholders’ equity is less than half the value of its share capital, the company must either fold or reduce its capital.
Air Macau, which is 66.92% owned by Air China (CA, Beijing Capital), dominates the aviation market in the old Portuguese enclave on China's south coast. In 2022, the airline reported that it operated 43% of all flights at Macau International Airport and handled 62% of its passengers. It also controls the distribution of slots to other airlines. However, as reported by ch-aviation, the SAR government is moving to break up the carrier's dominance at MFM, with the Executive Council recently sending legislation to liberalise access to the airport to the local Legislative Assembly for approval. The legislation is expected to be passed by the end of the year. Air Macau says it will continue to "strive to meet the needs of government and the residents of the Macau SAR."
