The parent company of Swissair today announced a loss of $1.7 billion for last year, blaming investments in Belgian, French and German airlines for "the worst year in the history" of SAirGroup's finances.
The loss compares with a profit of $165 million in 1999.
"The group intends to realign its overall business strategy to lay a sound foundation on which to substantially enhance its revenue and earnings performance," the statement promised.
It has already called into question the group's 49.5 per cent stake in the ailing Belgium carrier Sabena, as well as France's AOM/Air Liberte and Air Littoral and Germany's LTU. It is unclear whether it will honor its commitment to take up a 34 per cent stake in the troubled TAP Air Portugal.
The statement cited Sabena losses of $284 million, those of the French airlines together at $344 million and LTU's at $196 million.
Swissair had a loss of $112 million, it said, noting that fuel costs alone had increased sharply to $155 million, 56 percent higher than the previous year.
The group's uncontrolled descent from proud national flag-flyer to financial mess has been headline news in Switzerland since January, when chief executive officer Mr Philippe Bruggisser departed abruptly.
The weekly SonntagsZeitungand SonntagsBlicknewspapers reported Sunday that Mr Mario Corti, the new SAirGroup chief, would soften the blow by announcing a cash injection of at least $590 million from a banking consortium spearheaded by Credit Suisse.
Mr Corti was plucked two weeks two weeks ago from his post as the highly respected chief financial officer of food and drinks giant Nestle to become chairman and chief executive of SAirGroup in place of Eric Honegger.