Monarch goes into administrationOct 02, 2017
Administrators from KPMG have begun discussions with the group’s 2,100 employees, including 645 based at Luton where the company is headquartered.
The group’s engineering operation, Monarch Aircraft Engineering Ltd, is not in administration and continues to trade normally.
As a result of the insolvency proceedings, Monarch Airlines is no longer able to fly as its Air Operating Certificate has been suspended.
KPMG partner Blair Nimmo, Jim Tucker and Mike Pink have this morning (October 2) been appointed joint administrators to Monarch Airlines Ltd. Mr Nimmo, Mr Tucker and KPMG colleague Steve Absolom have been appointed joint administrators to Monarch Travel Group Ltd.
All flights operated by Monarch Airlines from the UK, and all future holidays booked with Monarch Travel Group, are cancelled with immediate effect.
The airline, which reported a loss of £291 million last year, was the UK’s fifth largest.
CAA chief executive Andrew Haines said: “We know that Monarch’s decision to stop trading will be very distressing for all of its customers and employees. This is the biggest UK airline ever to cease trading.”
Monarch’s chief executive Andrew Swaffield said the airline had been carrying 14% more passengers than last year but for £100 million less revenue. Monarch’s owner, Greybull Capital, had been trying to sell part or all of its short-haul operation so it could focus on more profitable long-haul routes.
The CAA, with assistance from the administrators and employees of the company and at the request of the government, will be coordinating the repatriation of Monarch customers who are currently overseas and who are scheduled to fly to the UK over the next two weeks at no cost to them.
These customers are advised to not travel to the airport until they have seen confirmation of their new flight on monarch.caa.co.uk
The CAA’s headline intention, today and in the next two weeks, is to seek to repatriate passengers to the UK as close to their scheduled return date as possible.
The monarch.caa.co.uk website also contains details of how customers can apply for refunds.
Mr Nimmo said: “Mounting cost pressures and increasingly competitive market conditions in the European short-haul market have contributed to the Monarch Group experiencing a sustained period of trading losses. This has resulted in management appointing us as administrators in the early hours of this morning.
“While this timing is unusual in insolvency situations, it was necessary for the appointment to be made once all Monarch aircraft were on the ground. This only occurs in the early hours of each morning.
“Once the company entered insolvency, the Air Operating Certificate it needs to be able to fly was effectively suspended, which is why all outbound flights were cancelled with immediate effect."
The adminstrators’ primary focus for the next 48 hours is to work with the Civil Aviation Authority to provide the infrastructure and information needed to help the government and CAA with the safe repatriation of the 110,000 customers who are currently overseas and due to travel back to the UK within the next two weeks.
This includes all those whose trip is not specifically covered by ATOL protection. The CAA has provided funding to enable the group to retain a number of employees to assist us with the provision of this information.
Mr Nimmo said: “We understand that this will be a difficult and distressing time for many and we anticipate a large volume of calls and queries from customers who are affected.
“We will also be speaking to all of the group’s employees today, and commencing the process of returning the group’s leased aircraft fleet to its owners.”
Together, the group offered airline capacity of over six million sector seats and tour operator passenger volumes of over 200,000 per year.
- Two dedicated helplines have been set up for customers in the UK and customers overseas:
Customers in the UK: 0300 303 2800
Customers overseas: +44 1753 330330
Further customer information can also be found on the CAA’s website: monarch.caa.co.uk
- Monarch, founded in 1968, flies to over 40 destinations from five UK bases: London Luton, London Gatwick, Birmingham, Manchester and Leeds-Bradford.
- The following companies have been placed into administration:
Monarch Holdings Ltd
Monarch Airlines Ltd
Monarch Travel Group Ltd
First Aviation Ltd
Avro Aviation Ltd
MH Aviation Transport Ltd (formerly Cosmos Aviation Ltd)
Monarch Holidays Ltd (formerly Cosmos Holidays Ltd)
Monarch 2011 Ltd