Defense cuts force Southern Air to file for bankruptcy
| Reuters
The filing comes as Washington's self-imposed year-end deadline
approaches to agree on a plan to shrink the federal budget or trigger
$600 billion in spending cuts and higher taxes.
The Pentagon early this year outlined a 2013 budget plan to reduce spending by $487 billion over the next decade.
Governmental services accounted for about 44 percent of the company's revenue for the year ended July 31.
In January, U.S. Defense Secretary Leon Panetta said the United
States intends to end combat operations in Afghanistan before the end of
2013.
Southern Air posted a revenue of about $428.2 million and a net loss
of $159.8 million for the year ended July 31. The company had assets of
about $206.9 million and liabilities of about $486.5 million as of that
date.
The Connecticut-based company, which operates a fleet of 11 Boeing Co
(BA.N) aircraft, has about 611 full-time employees, according to its
Chapter 11 petition.
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