World Duty Free, the company of the Swiss group of Dufry, which operates the old duty-free shops (known as duty free) of the Aena airport network is in danger of survival due to the high level of debt it has with the airport manager due to the coronavirus pandemic, and which has led to a conflict between the two companies that will have to be substantiated by the courts.
This is admitted by both the company and the EY auditor in the latest accounts for the year 2020 deposited this week in the Commercial Registry, and to which EL PAÍS has had access. In these, it is found that World Duty Free recorded net losses of 340.3 million euros in 2020 compared to the profit of 74.3 million obtained a year earlier. But the most serious thing is that it is noted that the working capital -the ability of the company to meet its obligations in less than 12 months, with those assets in the short term- has become negative “mainly due to short-term debt maintained with Aena ”, as specified by the auditor.
“In the current circumstances, society cannot predict with certainty how long the negative effects of the pandemic will last, which implies that, at the date of formulation of the attached annual accounts, there is significant uncertainty about the continuity of the company,” derived from the negative economic impact of the pandemic and the final resolution that occurs in relation to the payment of debts with Aena ”, states the management report.
World Duty Free had to face an invoice in 2020 of 312.6 million euros for rentals if it had paid in full the Guaranteed Annual Minimum Income (RMGA) associated with said contracts. However, as passenger traffic fell 73%, Aena offered a pact like the rest of its tenants consisting of an exemption in the payment of rent for the three months of the first state of alarm (from March 15 to March 20 June 2020) and a reduction of 50% of the minimum rent from that date until September 2021. As of this month, the full rent payment would be normalized.
The agreement was rejected by the Swiss group that considered it abusive and got the court number 39 of Madrid to provisionally suspend the collection of the income corresponding to 2020 and the execution of the deposit deposited of 25 million in case of non-payment. Now the courts will have to decide on the merits of the matter, although some courts of first instance have already agreed with the tenants in front of Aena, such as the one achieved by the Zea Retail family group of a Madrid court that links the payment of the rent of their shops from airports to actual traffic.
Battle in the courts
On this matter, the company is convinced that it will win the final battle against Aena in court. “The administrators of the company consider that the resolution of the judicial procedure with Aena will culminate in a satisfactory manner and that, under this scenario, the group undertakes to grant the necessary financial support to the company so that it can carry out its assets and attend to its commitments in the normal course of their operations, all in the context of the health crisis ”, indicates the account report.
However, the company of the duty-free shops warns that “in the current circumstances it cannot predict with certainty how long the negative effects of the pandemic will last, nor when the recovery of passenger traffic will begin.”
World Duty Free recorded revenues of 202.1 million euros in 2020, 73.6% less than the 766.4 obtained in the previous year. The gross operating result was negative (-386.7 million), compared to the positive 128.4 million of the previous year.
The company has availed itself of a temporary employment regulation file (ERTE) due to force majeure due to covid-19 since March 14, 2020 for 90% of its workers, which has been extended several times, the last one until April 10, 2022. Despite this, there was a decrease in the workforce of around 340 workers in 2020 to 3,309.