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The financial results for 2021 were consistent with the fact that PLAY is still in its early stages of development and, as a result, was not projected to be profitable in its first year of operation, having only started operations in June. COVID-19 also hindered growth and reduced revenue and load factor for the year. This trend has now been reversed, utilization is increasing, and the outlook for this year is encouraging as markets release the considerable pent-up demand for travel that has built up during the previous two years of travel limitations.
As the harmful effects of the COVID-19 epidemic fade, the Russian invasion of Ukraine poses a fresh issue, with the impact on PLAY thus far limited to an increase in oil prices. PLAY anticipates that this war-related price hike will boost its costs by roughly 10 million USD this year, given on current market conditions. This expense will be offset by a greater focus on cutting operating costs and the implementation of a fuel surcharge, similar to what many of PLAY’s competitors have already implemented.
PLAY has no plans to seek more money at this time because its cash position is good, it has no interest-bearing debt, and its booking flow is strong and expanding. When the invasion occurred, PLAY was in the process of implementing an oil price hedging plan, leading the price of oil to rise and subsequently fluctuate dramatically. PLAY will not apply its hedging strategy until the market’s visibility improves, since future market developments are quite uncertain, and markets are reacting to potentially short-term but extreme external causes.
PLAY, on the other hand, will step up its efforts to cut expenses across the board, ensuring that the impact of shifting oil prices on cash flow and margins is maintained to a minimal.
source : play
(not financial advise)
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