More than 10,000 people who are owed money by embattled regional airline JetGo are unlikely to see a cent, with the company poised to be wound up with massive debts next week.
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A new report from the airline’s administrators has estimated its liabilities to be up to $38.7 million.
This includes almost $2.5 million owed to employees and more than $23 million from unsecured creditors, including airline customers and several regional councils, such as Wagga.
In stark comparison, the company’s maximum “realisable” assets are $142,940, a report to the Australian Securities and Investments Commission says.
JetGo’s fleet of six planes held no value, the administrators said, as two were repossessed and four had no equity due to lease or loan deals.
Likewise, the company’s most valuable asset – an air operating certificate from the Civil Aviation Safety Authority – has no tangible value.
With this dire financial situation, voluntary administrator Jonathan McLeod has recommended those who are owed money vote to wind up the company at a meeting scheduled for next Friday.
The new report confirms more than 10,000 customers who bought flights have been left out of pocket.
Other parties owed money include seven regional councils – Wagga, Shellharbour, Dubbo, Rockhampton, Karratha, Port Macquarie and Tamworth – and at least four other private airports.
Wagga City Council mayor Greg Conkey continued to be tight-lipped about the how much was owed to the council.
However, he said the figure may be revealed in the next couple of days once he speaks with general manager Peter Thompson.
“There are certainly landing fees and once I speak to the GM, that figure may be released in light of what’s happened,” Cr Conkey said.
There are certainly landing fees and once I speak to the GM, that figure may be release in light of what’s happened.
- Wagga City mayor Greg Conkey
“There are two figures involved – backdated and current figures. So we’ll need to combine them and come up with the exact figures.
“The confidentiality reasons may no longer apply based on the latest. I’d rather an exact figure instead of a ballpark because ratepayers need to be aware of that.”
Cr Conkey also said he was “very disappointed with the outcome”.
“They provided a good service between this city and Brisbane. It indicated that there was a strong need for a link between the largest NSW regional city and Brisbane,” he said.
Asked about the council lobbying for another operator, Cr Conkey said: “We’d certainly be keen on talking with any other operators to take up that route.”
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Out-of-pocket customers are advised their best chance of recouping cash is to approach their credit card company and seek a chargeback.
In the statement to creditors, Mr McLeod warned they may not get to vote to close down the company due to a Supreme Court hearing scheduled for the day before the creditors meeting.
The result of the earlier legal action from Dubbo may see the company wound up by court orders instead.
The creditors meeting will be held in Brisbane on July 6.
Cr Conkey said that since it was an operational matter, the general manager would determine if any Wagga council representatives would attend the meeting.
JetGo’s money troubles came to light in late May when Fairfax Media revealed Dubbo Regional Council had lodged a request to dissolve the company over a $270,000 debt.
Days later, it emerged the company – which had already cancelled numerous flights – was experiencing a “critical shortage of cash” and operating just two planes across regional Australia.
On June 1, the airline cancelled all flights and confirmed it had filed for voluntary administration.
