Ladies and gentlemen, thank you for standing by. I'm Konstantinos, your Chorus Call operator. Welcome and thank you for joining the AGN Airlines Conference Call to present and discuss the first half twenty twenty financial results. All participants will be in a listen only mode and the conference is being recorded. The presentation will be followed by At this time, I would like to turn the conference over to Mr.
FPS Vasilakis' chairman. Mr. Vasilakis, you may now proceed.
Yes. Good afternoon to everybody. Welcome to our 1st semester results call. Just to say that aside from myself, our CEO, Mr. Eureganis, our CFO, Mr.
Kuberiotis, and our treasurer, Mrs. Maraki, are all in attendance. So all of us are available to answer your questions. We'll try to keep, the presentation and the discussion and the discussion broad and relatively short. So you can ask some questions on the broad direction of things.
In full understanding that obviously the current crisis, is probably the strongest one that Aviation has ever seen. I think it's accurate to say that airlines around the world and in Europe, in particular, are all more or less in the fight for their lives. That would not be an exaggeration. And it's also fair to say, that while probably at some point early on in the summer, there was some expectation that possibly late Q3 or Q4 would see a more substantial recovery it's now the case that because of the resurgence of the pandemic, as of early August and an increasing manner since, people around our industry are now realizing that both the winter is going to be very hard and actually the let's call it return to normality or to relative normality will take a longer period of time than what had been initially anticipated. So having said that, as an intro, let me shortly go into the results of Q2.
Why shortly because basically Q2 was a quarter of inactivity. We knew that, already when we spoke in May together. And then again, when we released some data after our AGM in July. So we knew that the second quarter of the year was going to have very little activity. Indeed, flights were down by 82% due to the restrictions of the pandemic and the restrictions of movement imposed by states.
In fact, the 82% was the overall share of the quarter reduction of the quarter, but was 95% and 92% down for April and May. Respectively, as a result, passengers were down by 92% and our revenue for the quarter was down to $40,000,000, essentially 88% down from a number of $347,000,000 or more than $307,000,000 revenue, lost foregone in the third quarter. So very much an inactive quarter. This is the reason that looking at things like cost per ASK, revenue per ASK or, of course, utilization or any other figure other than the bottom line and the reduction of costs and the cash burn is not very significant. Practically, there was very little activity, as I just said in the quarter.
As a result of the very minimal activity, we recorded an operating loss pretax loss before extraordinary results of $58,700,000 on the second quarter of this year against $31,000,000 profit the year before, despite significant efforts in costs, in non flat variable costs, which I think are visible if you go through our financial statements in both fixed payroll related, but also other fixed overhead costs, which significant reductions were achieved. But nonetheless, if you have no revenue, no top line, what happens to costs has an importance, but obviously can drive to any positive outcome. In terms of what we did with our staff, due to the inactivity of quarter 2, For the majority of the period, the majority of our staff circa 70% of our staff was in the Greek version of the Ferllo program called suspension here in Greece, which, the Greek state has executed as of, as of April. Indeed, 70% of our staff was in this program However, with some additional benefits paid over the minimum, by AGN in order to reduce to some degree mitigate to some degree the loss to their base. So if we add to the first quarter that's already been published, the results of the second quarter, as I mentioned, we go to an overall half revenue fall of 64 percent reaching $187,000,000 for our, 1st half.
With 2,400,000 passengers, altogether, flown in the first half down from 6.5 million passengers last year. Again, most of the delta comes from quarter 2. And an overall underlying pretax loss at $132,000,000, adding the $58,000,000 of the second quarter to $73,000,000 of the 1st quarter. Compared to only $17,000,000 of losses in 2019. And those are our underlying losses, pretax losses before extraordinary losses On top of that result, we have the effect of ineffective hedging, which for both quarters and indeed effectively for the whole year, stood at $68,500,000, primarily due to the amounts of fuel that we had pre purchased, but did not consume either in the 1st or second quarter of the year or indeed are not anticipated to be consumed in the last 2 quarters of the year, H2 of the year.
So all these are valued and estimated. And indeed, in the second quarter, we took a more aggressive or probably more accurate estimate of the little sign we will do in the remainder of the year. And as a result, we added a total of $68,500,000 of additional losses to the 132 bringing our overall results for the periods now going to an after tax basis of $158,800,000 or $159,000,000 of loss altogether, including the extraordinary results for the first quarter sorry, my mistake for the first half as opposed to 13,000,000 of losses in 2019. Just to say one thing about these numbers, The losses of the second quarter were pretty much spot on with the guidance we had given you, in May 18th. And again, after our General Assembly for 26 $28,000,000 loss per month, for the second quarter.
That's practically exactly the number that was added to our losses, including extraordinary for the second quarter. So, there's nothing surprising for these figures. And in terms of cash burn for the 1st 6 months of the year, the total cash burn for the 6 months reached 110,000,000 of which $65,000,000 was actually cash burn in quarter 2. Main reason for delta between cash burn and losses main reason, but not the only reason is the inclusion of the, ineffective hedging of the second half of the year, which will be paid for during the second half of the year in the first half losses as well. Also some deferrals and some other items, but the main item that is different is this one.
So again, in a nutshell, I don't think we should stay very much on H1 results since they were pretty much expected. There was no, there was no, expected, the significant revenue activity and the costs, when you don't fly very much are pretty much, known, So that's why our estimates were also very much online. I think it's more important to talk a little bit about what has happened since, the end of the first, of the first half or the second quarter, when we started rebuilding our activity gradually as, the pandemic receded across Europe and equally importantly, as the restrictions imposed by countries started receding by Europe. So just to put some things in context, in context, we know that between basically the 15th June 16th July was the time period that, the main intra European restrictions for travel were restricted. I should say the absolute restrictions for travel were restricted.
And as a result, sorry, were lifted, I'm sorry, And as a result, also activity started to build gradually from June and then into July August. I would say that the market's initial, what's the right word, confidence about 2 things some measure of common protocols, which the European Commission attempted to establish in various meetings in June early July together with EASA. And also the markets hope that A, passengers would be willing to travel and B, The pandemic, 2nd wave would not come before October where things positive, let's say, expectations that lasted for about 30 to 45 days from 15th June until the end of July. So during that time period, both AGM, but also pretty much all other airlines in Europe were stating that they would be increasing gradually the capacity to the market, the recovery rate of their flights and expected demand between July going into August, from August, going into September, and then from September to October. Now This was important because to some degree, it shaped the capacity or the declared capacity to the market.
But at the same time, it's also to some degree, shaped customer response. So we did see in the second part June and until, for a good part of July, almost all of July, a rebuilding of the tendency of the customer
to book
tickets, still within a relatively short horizon before the flight, but at least in a significantly different way, than during the lockdown periods, obviously. And basically as a GM, we started rebuilding our capacity significantly from June to July, from July to August, driving up to roundabout 50% of overall flight activity in August with a slightly lower number than that in international and a slightly higher number than that in domestic. This was our aim and this was our, let's say, anticipation in terms of what we were trying to do. Unfortunately, it was initially a good period of sales for the 1st 30, 40 days from 15th June and on. Started to reverse itself, towards the end of July, beginning of August, when the resurgence of the pandemic again came back.
I would say a couple of months earlier than the theory of the second wave, anticipation for Europe, In fact, I don't even know whether there was a difference between the first or second wave, but certainly, what became apparent was that there would be, again, increased number of cases around Europe throughout Europe. And then again, unfortunately, in the beginning of August or since the beginning of August, We saw again a breakdown in the commonality of the response, even among European countries. So not only did we have the scenario that of course, many non EU destinations remained inaccessible, And that has, of course, both a direct and indirect effect to our network. So whether it is the U. S.
Or Asia have an indirect effect or whether it is Russia and Israel and Middle East, and some Scandinavian countries that actually were outside our reach due to restrictions for the entire summer, but also even within the EU core, let's say, region, we started having from early August, again, restrictions either in terms of needing to not fly at all or quarantine upon return or pre flight COVID testing or post flight COVID testing, all of these things starting to affect again the demand. As a result, to make a long story short, we flew, during the second, during the third quarter with, I'm going to give you an estimate of roughly 62%, less passengers than the year before. So the 3rd quarter is going to have for us a little bit short of 2,000,000 passengers. And we achieved that by reducing the seat offering by round about 62% So, the flights reduction and the seats reduction was significantly lower than the passengers achieved. Why because all airlines in Europe, including ourselves, have recorded load factors for the summer that were typically 2024, 25 points lower than our usual seasonal performance.
So for Aegean, in particular, what used to be around 88% load factor in Q3 is going to look more like 65% load factor for Q3. For us this year. Now that means obviously that I'm not gonna tire you with the exact curve, how things developed. But essentially, we're talking about an initial surge of demand relative to what we had before. An equal gradual buildup of our capacity and competitive capacity, hearing about airlines stating competitive airlines stating that they intended to operate up to 70% or 80% of their network initially for September or October, particularly the low cost carriers, And then a gradual reversal in the market, which has led now to much, much more conservative expectations leading down to significant lower numbers than that.
So Q3 in a nutshell, will be round about 2,000,000 passengers round about 22, 23 load points lower than last year. And In terms of flights round about 50% lower than last year, but, again, with a different Delta and International versus domestic. Having said all that, Q3 is expected to bring a pretax result between $25,000,000 $30,000,000 negative for the quarter, which of course might sound better than the quarter 2 or the quarter 1, but we have to remember that this quarter were typically a gen makes all of its money. We have a very seasonal, operation. And last year in quarter 3, we had the $91,000,000, I believe, earnings pretax result.
Therefore, we cannot say at all, that the operation of quarter 3 has been satisfactory. However, if we go to, to, other experiences similar to ours, if we looked in the past, in around Asia to see what happened in heavy viruses and the effect to their local markets. We had seen there that it takes typically up to 4 or 5 or even 6 months Once we reconstitute flights to have a positive margin, here, positive margins were achieved. The result, the fixed costs were diminished by some degree of flight variable margin, which is positive because it indicates that there is some, ability, some demand for travel even early after the pandemic. However, what was here, the case is that this demand, whether it is because it was, only leisure driven, only long vacation driven, not for city breaks, not for corporate travel, not for even multi, multi locations of occasions, but rather just for the a longer type of vacation in one location, only for the summer between that and between the resurgence of pandemic, that let's say, degree of support to demand was relatively short lived.
Now, the meeting here again, this is going to tell us a little bit about what we did in the summer with regards to arrangements for our fleets and our personnel, and we'll get back to giving you also a little bit of an outlook for what we think might happen in Q4.
Well, regarding the fleet, we kept the order of 46 aircraft, but we have agreed with participants the deferrals for the period between 20202022. Now more specifically, we had 26 deliveries planned for the period 220 to 2022. And we're going to end up having 15 15 deliveries for this period. We still continue to be one of the few airlines that continues to receive, to receive new aircraft. And this is important.
And at the same time, during this period, 2020 to 2022, we have 26 jets from our current CO fleet expiring the fact that gives us the flexibility to adjust to the realities that will emerge in the coming months, in the coming year, and adjust our fleet sizing to the new market realities. Short term, we receive 5 plus 4 new A320s until the beginning of 2021. And in total, the deferral of these deliveries, contribute to a reduction of our PDPs by about 1,000,000 in the same period, 2020 to 2022. Important is to note again that through the expiration of our current CO aircraft, we do have a lot of flexibility to adjust to the very difficult to predict the realities that will emerge in the next year or 2. Regarding now, our, our personnel in the third quarter, as Bastig is mentioned, we operated significantly more flights And that resulted in bringing back our staff back to the operation.
We had roughly, we stopped having the using the Furlough program that was one of the horizontal programs that the Greek government established to protect employment. So we stopped using the Furlough program and we moved to the like the quarter pipe program that the Greek government adopted, which is again, a horizontal program for the Greek economy, which is a fifty-fifty employment scheme by which a person that's employed part time, let's say, 50% is paid by the company for the 50 percent of his or her salary and receives he or she receives from the Greek State 60% of the remaining 50% of its of his or her compensation. About 75 end of our personnel during quarter 3 was employed under the Syner Garcia program, which is the Curstad BiTE program, as I said. And 25% was in full employment. So we put a lot of emphasis during the quarter 3 when our operations start becoming more substantial.
We put a lot of emphasis on taking all possible health precautions to protect, obviously, our passengers, but also very, very important our own colleagues. We have applied very stringent and strict protocols in turnaround claim, in overnight cleaning and disinfection. Of the aircraft, all the precautions of our frontline personnel in terms of using masks and other, all the other protective gear as has been prescribed by the local authorities. And we have established also a program through which we do test regularly our frontline our frontline staff here in our premises, both cabin crew and cockpit crew and other frontline stuff. We test them regularly every 2 weeks for the
for COVID. I guess,
Yes. That's about it.
Okay. Just a couple more things to say about Q3 with regards to what happened in Greece, relative to the rest of Europe, I think it's worth saying that the Greek, the Greek tourism market did perform a little bit better or significantly better than the average European tourist market. As a result, What we saw in overall arrivals to the country was significantly less reduced than in other countries in the south. I think there was a significant gain of market share and a gain of trust towards the country, which should not be, I say, I think, undervalued. We shouldn't forget about that.
It's very comforting from that angle to see that not only people came, but broadly speaking had positive experiences while here. So that seems to build some confidence, for people to come back always within, of course, the restrictions, of what the pandemic means. And the fact that, of course, it does significantly reduce the propensity of people to fly for different reasons, corporate and leisure. But it's important to have the brand of Greece reasonably well protected within this. So I think This is something that also has to be mentioned.
Now, before, before closing my initial remarks, awards about the last quarter of the year, I would say one would have expected better visibility I would say, given how intensely the case number has been building up given how quickly people like Lufthansa, Ryanair with, Thailand, Air France have been Talking down their capacity and expectations for winter, we also have to say 2 things: one that visibility is extremely low Yes, we all expect to hear something from the pharmaceutical side before the end of the year, possibly vaccines, etcetera. But Today, bookings are very low. Booking period is lowest than it's ever been. Practically, it is under 20 days. For all forms of travel within Europe.
And as a result, all we can say is that a reasonable expectation providing there are no further, full restrictions or lockdowns for the winter, we would expect to have in Q4 roughly a third of the passenger traffic over the year before. But again, that is a very, very, what's the right word obscured, let's say, forecast because it's not driven by bookings, which are anyhow so short in terms of, when they come, but it's and it's driven also by the hope that there will be no further, as I said, market closures Now what that means is that, again, under tremendous underutilization for the winter, and a possibility that we might have to resort again to some kind of a furlough program for part of our staff if things indeed go down to that level or lower. I think that's the initial remarks we have and happy to try to take some questions. We will keep our answers short and try to be broad. Again, gentlemen, ladies, please, remember, visibility is very low And therefore, accurate predictions are next to impossible.
Thank you.
Ladies and gentlemen, at this time, we'll begin the question and answer you. The first question is from the line of Sidiad Natalia with Eurobank Equities. Please go ahead.
Yes, sir. Hello. Good afternoon. Thank you for a very nice presentation and, you covered broadly, all the summer period and and many things we would like to ask. I have a question regarding the amount paid for cancellations.
Or what what what you have been doing about that, with regard there was a in the press, a big amount of money paid by other airlines and this did this happen also with you, or did you give out vouchers or or other forms of money? To canceled flights and for the summer period also?
Well,
we are a much smaller airline than the bigger airlines that you mentioned. So all our amounts are smaller. Nevertheless, what I can say is that there is a refund possibility and there is a fund process, both for individuals and for travel agents, that, of course, there have been also vouchers issued as well. Between the vouchers that have been issued and the refunds that have been issued, I believe, round about 75% of total outstanding cases have been handled. And there's a residual I would say overall 25 percent of cases that are either pending or we have not received an application yet.
Should these cases proceed, they will obviously cause another outflow of money for the company, whether it is in refunded amounts or whether it is in additional vouchers. Also to let you know that effectively today, vouchers are not only refundable, when they expire so that you get your money in the end, but also they can be used by other people. So if a person does not use his voucher, he can give it to another person in his company and his family, and that other person can use it as well. Therefore, it's not very distant from the effect of having money because the particular person cannot use it, another person can use it. So I hope I've given you a broad answer.
I'm not going to give you super minute numbers, but I think we've given you an idea of what's involved in terms of the dealing with the evolution.
Yes, yes. Thank you. That's cover the question.
The next question is from the line of Lavada Victor with Bureau Securities. Please go ahead.
Hi. Thank you for taking my call. You mentioned that you expected deliveries of 15 planes between 20202022. So from what I understand, you had a delivery of 5 plants in, in 2020, and we expect 4 other plants in 2021. The the a321.
So I'm just wondering, what are these extra planes? And also, by by, how much can you potentially, reduce your fleet until 2023 since you have the flexibility to do so. What is the minimum size of fleet that you can achieve by 2023. My other question was regarding your total liquidity. What is your total liquidity available today?
In terms of cash and line spread? Thank you.
Okay. First of all, just to make sure we don't have any confusion, what Mitsy Urgani said, 5 minutes ago, we used to have 26 aircraft to be delivered 20 to 22. That number is now down to 15. We have received already 5. So there's 10 pending for 20212022.
I believe the number is 4 until summer. 21 and another 6 in 22. So in terms of planes that are not already here, not the 5 neos were already held, have another 10 for 2021, 2022 from now until the end of 2022. In terms of aircraft departing or able to depart is the right word because their leases are expiring. The number is 26 Jets and 2 turboprops.
Now that does not mean that 26 jets will leave or that 2 turboprops will leave, but this is the extent of our flexibility with regards to the fleet. Also, the contract for Mirbus allows some additional flexibility in Absa delivery dates, but I believe what we are more likely to use in the short term is basically how many of the expiring aircraft we will extend or not. The good thing about having many expirations is not only that you can allow aircraft to leave, but also if you want to extend, you get significantly better terms. As you might imagine, lessors are quite eager to keep aircraft with airlines these days. Because the market has definitely more supply than demand.
In terms of liquidity, I believe the numbers are there in the statements, for the 6 months. What I can tell you again is that We burned $110,000,000 for the 1st 6 months. We anticipate in the 9 months to be 160,000,000 cash burn in the 9 months that is. So to burn another 50,000,000 in terms of cash, not financial losses, but cash in the third quarter. So to be at 160 minus in cash from the beginning of the year.
Now what I need to add to all that is that we have not yet contracted, we are, we believe about 1 or 2 weeks away from the final contract with the 4 systemic banks to get the big 80% state backed loan. Is $150,000,000. So we have not drawn on that loan yet. We are likely to be drawn on that loan in October. So I would say our big problem is our losses.
We do not have a short term liquidity issue.
The next question is from the line of Kumar Ahal with HSBC. Please go ahead.
Good afternoon, gentlemen. I had a couple of questions. So first of all, I wanted to understand about your CapEx plan. So, so basically, I understand that in the second quarter, you spent almost 1,000,000 on the CapEx taking 3 planes transferring from the lease to own. So what exactly is the transaction?
Why you've done so? And what is your plan going ahead? I mean, are you, are you sort of planning to take more planes on your balance sheet rather than lease sale and leaseback. So if you could please help understand that. Thank you.
I am a little bit confused exactly the direction of the question because I believe we have already emphasized the things. We reduced our incoming total 20 to 22 by 11 aircraft. So that is obviously a CapEx commitment reduction. That in total brings in terms of pre delivery payments, pre delivery payments, a saving of around 110,000,000 in the course of the 3 years in pre delivery payments again, I repeat. And as we said earlier on, we bought a a high number of lease expirations.
Now, how do we intend to finance these aircraft? It's a mixture of it's a mixture of different products. We have some bank financing the first couple of 321s we're picking up. And then there's a largely the other aircraft that are coming within those 2 years are mostly from lessors where we have we are taking from their skyline or there are aircrafts that we have agreed to do sale leasebacks on. Therefore, other than the pre delivery payments that are to be made, which are for 2020, 2021, 2022 in total, under the new program, excuse me, $175,000,000, roughly $180,000,000 from September of 2020 to the end of 2022.
Other than this, amount of money, which is reduced, as I said earlier, by $110,000,000 due to the partial deferral of aircraft. There are no significant cash asset during the period other than the PDP, the aircraft are going to be either direct from lease or, from, from, what should we call it, from, sale leasebacks. Now in terms of your question, what is the CapEx in the 1st quarter or 2nd quarter there was a purchase of 2 seals that was agreed last year and was executed, I believe, in January, which is probably there. That is the majority of that. And then, of course, we all know that under IFRS 16, the leases also appear as liabilities and as assets.
So, in the balance sheet statements, the balance sheet grows even when we add leased aircraft these days. So I hope most of your question has been answered.
Yes. So basically, just to reconfirm, so in the second quarter, you are showing purchase of tangible assets worth $55,000,000. So is that, is that, does that belongs to the CEOs?
Our CFO will answer that.
Yeah, in the second quarter, $42,000,000 on what you see in your financials are related to the purchase of these 2 A320s sales that occurred in in that period,
actually. That was contracted last year.
Yes, which was contracted in 2019. And actually it includes the maintenance reserves also of this aircraft, which are related, which are linked to this transaction.
Right. Okay. It does not actually that
does not have a cash outflow of 42,000,000. That's why that's what Michalis said about the reserves because the reserves are basically being recovered. Right. Fair enough. If you have any questions on the technicalities of call Mrs.
Demeraki offline because I think it's getting a little bit too technical for the audience.
The second thing also, I wanted to understand about the, about the staff for low scheme. And as you said that, you know, if the recovery turns out to be much slower, we might have to go for another follow-up option. So this is basically what I wanted to understand is that what sort of options do you have in case the demand really turns out to be slow? I mean, will, are you, would you be able to continue with the current scheme wherein you said that the 75% employees will be on that scheme and wherein you will be paying 50% or you have any other further wherein you can opt for that. So what exactly what sort of options do you have for that?
Okay. First of all, there are 2 basic programs that are available by the Greek government. 1 is a 3rd law option or called suspension in Greek that pays a minimal amount of money, €5.70 per month to employees and removes all other costs to the employer, social security payments and whatnot this is basically suspension. So during that period or furlough, during that period, the employee cannot work for the company. And there is also an another program, which is, let's call it, the partial work subsidy program, which requires the employer to pay, as Mr.
Georgiani said, 50% of the regular salary, and then the state contributes, 60% of the missing 50%. So altogether, it's roughly 80% of the salary for 50% of the work and the employee works for 50% of the time. So that's reduced work. These programs are now available until basically the end of the year to the Greek companies that have been affected by significant revenue reductions. We anticipate that this extended, exactly because tourism or transport are very, very unlikely to recover before quite late into H1 of next year.
So we expect these programs to be, extended now the Greek government has secured and is funding these programs from a European program called Shore, So that is already in place. As a matter of fact, the funds are that Greece received were somewhat higher or significantly higher than what they were expecting initially. Therefore, we are highly confident that this will be continued, but it's not written in law yet for after the end of this year. Now the difference between furlough and partial work is very clear if my salary is, let's say, a €3000 and on top of some social security contribution, and I go to furlough. I cost nothing to my company for this month, but I can also not work for the company.
And if that's the suspension part. And so I'm only paid some money from the government. And in the other case, I reduced my cost by 50% to the company but I can also offer my services for 50 percent of the time to the company. Whether you use 1 or the other depends on how underutilized your fleet, your program is relative to normality.
Right. So basically, basically you're expecting this program, follow-up program to be extended beyond the year end. Is that correct, right?
That's correct. It's an expectation, but not an assurance because it's not in law yet.
Right. Okay. Perfect. Perfect. The other thing also I wanted to understand, understand what is the situation with with the political instability between the Turkey and the Greek?
I mean, so has that been settled down completely or is that still going on? Do you see any additional risk
but I'm not going to venture into that. That's a little bit above my qualification. I would say that they are now in discussion. So I feel a little better than before, but this is not something that I can actually validly or intelligently comment on.
Right. Fair enough. On the demand side, also, I wanted to understand, so basically, of course, is weak. And then as you said, international is probably more weak, more weaker than domestic. But when particularly talking about the international demand, where do you see this demand coming from?
Is it more from like, is it from Germany, UK or what exactly how the mix looks like, you know, of course, there are very, very few countries are now green. So so what sort of, how, how, where the demand is coming from actually when the international demand?
It's always, it's the steadier part of the demand has always come with in Germany, Austria, Switzerland, that sort of triangle over there, where I think, I'm sorry? Where I think, the people, I would say, psychologically, perhaps have been and medically have affected less, by the COVID. England is somewhere in between. So it's a very important country, England and France. I'm somewhere in between.
We have reduction, significant reduction, but also some strength of demand. And then Italy and Spain, from the let's say, larger European countries are certainly the lowest of the demand and then to our east. Unfortunately, it's mostly non use. So access is quite limited, has been quite limited, whether it is north or south east, And the Balkans, which were a very good source of, let's say, short haul international, have been quite compromised by restrictions. So again, going back to the beginning, Germany, Switzerland, Austria and France, are among the strongest from what we have seen to our demands because we also have to consider, we are largely Athens based.
We also have the Saloniki which is quite strong with Germany. And so that's more or less the picture.
And then, and is this demand more of a leisure demand or is it, is it sort of a mix of leisure plus business?
It's entirely leisure or VFR. There is very, very, very negligible corporate travel. Most, most large companies do not have travel in their policy these days at least until the end of the year. We hear some for even beyond that. And so for international, it is very much leisure and visiting friends and relative, as a driven.
For domestic, okay, it's a little bit different because small, small businesses and self employed people to travel around the country So the bag is a little bit more mixed. But for international, it's certainly leisure and the VFR.
Okay. My last question, I'm so sorry for a long list, but my last question, so on the fuel hedging, in active hedging loss, you're booked about almost 1,000,000 during the first half. Is that all done and done and dusted, or do you expect some more losses in the third quarter 4th quarter?
Providing, we fly what we flew in the we know what we flew in Q3, right? So providing what we estimate for Q4 is correct in terms of how much or how little we will fly then the numbers are all in. The only way that there is more ineffective hedging to be added is if basically instead of flying 1 out of 3 more or less or 1 out of 37%, 38% for the last quarter. We are flying 15%. Which case, there will be some more ineffective hedging, but I hope that will not be the case.
I do not know that would not be the case, but certainly Also, because the big hedged amounts run until September, October and the amounts for initial hedging were significantly lower in winter, materially, it's quite difficult to see that number changing significantly.
Perfect. Thank you so much and good luck.
Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Mr. Vasilakis for any closing comments. Thank you.
Thank you all for your attendance. Once again, we are going through definitely the toughest periods of aggregation in a very, very long time. Certainly the toughest time for our company in a very long time. Visibility continues to be low, but we are working very hard to find solutions to individual problems. It's going to be a very uphill and very bumpy road with lots of fog clouding the way.
There's no doubt about that. And it's going to be a very, very challenging and difficult winter. As we wrote also very clearly in the press release with the results, We think it's very important. It is crucial that we have common protocols for travel that probably necessitate pre flight testing for definitely non EU to EU flights as of next year. Possibly that same principle could be applied within EU if it is considered necessary in cases where it is considered necessary, but clear position of our airline and indeed pretty much every airline in Europe is that pre flight testing now with the 1000 or 100 of 1000 or 1,000,000 of tests being conducted around the world today is quite feasible.
It's getting cheaper. It's getting faster. And it's a much more effective way of protecting, receiving countries or repatriating countries from the potential of disease rather than quarantine or market closures or actually upon arrival testing. For obvious reasons, if somebody is found to be sick, then they don't fly, and that protects both the person by giving him a more comfortable recovery period at his home and of course, the incoming country and would allow the whole world to become accessible again as of 2021, something absolutely necessary for networks of airlines to gradually recover, absent that, it's going to be very hard. So, we think you once again for our, for your attendance to our call.
And, just to assure you that we are looking at every possible scenario of how to best reallocate our network and our fleet in order to find ways to gradually mitigate the effects of this really destructive prices. Thank you very much.
Ladies and you may disconnect your telephone. Thank you for calling. My pleasure.