Atlantia swings to a net loss of £8.99 million in the first quarter due to COVID-19 restrictions
- Atlantia swings to a net loss of £8.99 million in the first quarter due to COVID-19 restrictions.
- The infrastructure group reports a 15% decline in revenue to £1.99 billion in the first quarter.
- Atlantia expresses confidence in its £2.61 billion settlement offer over Morandi bridge dispute.
Atlantia (OTCMKTS: ATASF) released its first-quarter financial results on Thursday that revealed the company to have swung to a loss in Q1. The company attributed its loss to the Coronavirus pandemic that further weighed on the performance of the company that is already struggling with the fallout ascribed to a political dispute.
Shares of the company posted an intraday gain of about 4% on Friday. At £12.93 per share, Atlantia is roughly 30% down year to date in the stock market after recovering from a low of £8.83 per share in March. Learn more about the capital markets.
Atlantia reports a 15% decline in Q1 revenue
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The Italian infrastructure group reported a 20.7% decline in motorway traffic in the first three months of 2020. Due to the nationwide lockdown to suppress the fast spread of COVID-19, Atlantia also noted a 33% decline in passengers at its Rome-based airports.
Italy’s Benetton family currently has a controlling stake in Atlantia. At £1.99 billion, its revenue in the first quarter came in 15% lower. The Italian holding company recorded £8.99 million of net loss in Q1 as compared to £141.20 million profit in the same quarter last year.
Atlantia’s dispute with the government dates back to August 2018 when an Autostrade (Atlantia’s motorway unit) operated Morandi bridge collapsed resulting in 43 casualties. Documents released in September 2019 suggested that safety concerns were raised as early as 2014. Following the accident, the Italian government has threatened on numerous occasions that Autostrade could lose its lucrative motorway concession.
Atlantia proposes £2.61 billion settlement offer
The political dispute, as per Atlantia, has fuelled maintenance costs and slashed its rating to junk. The infrastructure group proposed a £2.61 billion settlement offer to the transport ministry in March. While a formal answer to the proposal has not yet been received, the company expressed confidence on Thursday that an agreement is likely.
Atlantia also highlighted on Thursday that several of its units, including Autostrade, have approached the government to seek financial support worth about £1.53 billion to cushion the economic blow from COVID-19 that has so far infected more than a quarter-million people in Italy and caused over 34,000 deaths. Its digital toll-road payment unit, Telepass, however, is not seeking state-backed loans.
At the time of writing, Atlantia is valued at £10.67 billion and has a price to earnings ratio of 82.23.