GOL to use United States Chapter 11 process to strengthen financial position

GOL Linhas Aéreas Inteligentes S.A. and its subsidiaries have voluntarily initiated Chapter 11 proceedings in the United States Bankruptcy Court for the Southern District of New York (the U.S. Court). Chapter 11, a U.S. legal framework, is employed by businesses to secure capital, restructure finances, and strengthen long-term business operations while maintaining normal functionality.

As part of this Chapter 11 process, GOL has obtained a financing commitment of US$950 million in new debtor-in-possession (DIP) financing from members of the Ad Hoc Group of Abra Bondholders and certain other Abra bondholders. The company will seek court approval for access to this funding during its First Day hearing in the upcoming days. Pending court approval, this financing, along with cash generated from ongoing operations, will furnish substantial liquidity to sustain regular operations throughout the Chapter 11 proceedings.

With the support of the court-supervised process and additional liquidity from DIP financing, GOL's passenger flights, GOLLOG cargo flights, Smiles Loyalty programme, and other company operations are continuing without disruption. The company remains steadfast in delivering safe and cost-effective air travel services, ensuring an uninterrupted travel experience for its customers. Existing arrangements, including the use of tickets and vouchers, as well as the accrual, purchase and utilisation of Smiles loyalty programme miles, will continue seamlessly. GOL's codeshare and interline agreements will also remain available to customers.

This Chapter 11 process is pivotal to GOL's strategy to restructure immediate financial obligations and strengthen its capital structure for long-term sustainability. The company anticipates emerging from this process with a substantial infusion of new capital, including the aforementioned US$950 million in DIP financing.

Despite encountering challenges to its capital structure and navigating an environment of reduced aircraft availability, GOL's operational performance remains robust. In 3Q23, the company achieved top-tier operating results among Latin American airlines for the fourth consecutive quarter, boasting a net operating revenue of R$4.7 billion—a 16.4% increase compared to the same period in the previous year. This growth was predominantly attributed to significant contributions from the Smiles and GOLLOG cargo operations, which collectively grew by 65.1% in 3Q23 compared to 3Q22, totalling R$412.6 million. Notably, in December 2023, the occupancy rate reached 82.7%, reflecting a noteworthy 4.8% increase from the previous year. (£1.00 – R$6.27).