Mozambican State injected 23.5 million for LAM to meet obligations

The Mozambican State injected 1,703 million meticais (23.5 million euros) into Linhas Aéreas de Moçambique (LAM) in 2025 to allow the carrier to meet its obligations and commitments. The company notes in its 2025 financial statements that the State, as the majority shareholder represented by the Institute for the Management of State Holdings (IGEPE), “injected the necessary resources to enable LAM to meet its obligations and commitments to third parties” in 2025, which amounted to 1,703,080,906 meticais (23.5 million euros). The report also registers financing associated with the restructuring process originating from Hidroeléctrica de Cahora Bassa (HCB), Portos e Caminhos de Ferro de Moçambique (CFM), and Empresa Moçambicana de Seguros (Emose), which became shareholders of the company, amounting to a total value of 3,604 million meticais (49.8 million euros).

LAM ended the financial year with total liabilities of 21,892 million meticais (302.2 million euros) and bank loans of 5,365 million meticais (74.1 million euros). The report further mentions that, due to cash flow difficulties, the company is failing to comply with repayment plans for loans contracted with BCI and Moza Banco. Despite having recorded net profits of 5,263 million meticais (72.6 million euros) in 2025, the carrier closed the financial year with negative equity of 16,076 million meticais (221.9 million euros), compared to negative 21,348 million meticais (294.8 million euros) in 2024.

Management admits that, under current circumstances, current assets are lower than current liabilities, but maintains that the financial statements “were prepared in accordance with the going concern principle,” which assumes continued shareholder support and the realization of “profitable operations in the future.” LAM has faced operational problems for several years related to a reduced fleet and lack of investment, and is currently undergoing a restructuring process. Hidroeléctrica de Cahora Bassa approved the acquisition of 25.2% of LAM’s share capital in 2025 as part of the airline’s restructuring, followed by Emose and Caminhos de Ferro de Moçambique, each holding 15.4%. According to the 2025 General State Account, HCB approved an investment of 36 million dollars (30.8 million euros) in this process, as well as the creation of Fly Moz, an entity with the “objective of securing financing for LAM.” The insurer Emose approved an investment of 22 million dollars (18.8 million euros), “becoming the holder of 15.40% of LAM’s share capital structure,” identical to Caminhos de Ferro de Moçambique, according to the General State Account. A year ago, the intention to divest 91% of LAM’s share capital was announced, but the transactions completed so far represent 56% of the carrier’s shareholder structure.