Fastjet auditors raise concerns as losses and delays pile up

 
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A SERIES of disputes and delays have prompted Fastjet’s auditors to issue a warning about the airline’s ability to continue trading.

Fastjet, which transformed itself from a software developer to an Africa-focused aviation group in late 2011, has suffered setbacks in Tanzania, Ghana and Angola and became embroiled in a long-running dispute with the founder of its Fly540 Kenyan unit.

Fly540 has “not performed to our expectations”, Aim-listed Fastjet said as it booked $34.9m in writedowns and impairments on Friday night.

Auditor KPMG said in its report that “material uncertainty… casts significant doubt on the group’s and the parent company’s ability to continue as a going concern”.

For the 18 months to the end of 2012, Fastjet posted a net loss of $56m and said it will need to raise further funds.

“[M]anagement is pursuing a policy of a creating a shareholding structure in each airline that allows for greater local investment,” chief executive Ed Winter said in a statement.

Fastjet’s major shareholders include Lonrho and EasyGroup.