Monarch Airlines has received a £165m cash injection from its majority shareholder, private equity fund Greybull Capital.
The lifeline investment, which is the largest in Monarch's 48-year history, has allowed the air group to renew its ATOL licences from the Civil Aviation Authority (CAA) for the next 12 months.
Monarch was granted a two-week extension on the licences, which ran out today, from the CAA after the company said it was lining up a major funding boost.
The remaining funds from Greybull's boost will be put towards funding "future growth plans".
Luton-based Monarch was close to folding in October 2014 before Greybull acquired the airline from the Mantegazza family, who had owned it since the 1960s.
Last month, it was reported the group was seeking tens of millions of pounds in refinancing after the post-referendum devaluation of the pound had made market conditions tougher, while the purchase of 30 Boeing 737 Max 8 aircraft in October 2014 had also had an impact on the company's finances.
The first of these aircraft is due to be delivered in 2018, Monarch said in a statement today.
Chief executive Andrew Swaffield said:
"We asked for the extension to ensure we could secure the funding; obviously something of this size is always going to take time.
"There was a dampening of holiday bookings in the last two weeks, but the signs this morning are that things are returning to normal."
Swaffield added that he was confident about his airline’s long-term future, but said he expected the significant challenges of terrorism, the closure of Egypt and decimation of Turkey's tourism sector, as well as the weak pound, to continue to prove difficult.
These troubles have meant that while profit last year was in excess of £70m, this year Swaffield said it would be just over £40m.
The replacement of its aircraft with the new Boeing fleet, Swaffield added, will be 22 per cent more fuel efficient than its current fleet and cost Monarch about 80 per cent less in maintenance costs. “That will make us about the newest fleet of any airline in Europe and that’s one of the ways we intend to meet the challenges in the aviation industry,” he said.
But while the weak pound has taken its toll on airlines across the board, Swaffield said he hadn't noted it having a major impact on consumers' desire to go abroad as they seemed to "very quickly realign to a new exchange rate".
"The British consumer tends to be pretty resilient when it comes to holidays," he said. "The real currency effect for us is on our cost base."
A CAA spokesperson said: "The CAA has renewed Monarch's ATOL licences until the end of September 2017 following confirmation that all licence requirements have been met. Monarch's licences permit them to sell ATOL protected holidays until 30 September 2017, after which they will be required to obtain a new licence in line with the annual process for all ATOL protected companies."