At its 133rd session, the Government of the Republic of Croatia adopted a decision to increase the share capital of Croatia Airlines from the current EUR 92.38 million to EUR 248.38 million, thereby raising state support for the national carrier by approximately EUR 156 million over the period from 2025 to 2027. As explained by Minister of the Sea, Transport and Infrastructure Oleg Butković, the capitalization will be carried out through a combination of cash injections amounting to EUR 70 million and the conversion of around EUR 78.8 million in existing claims arising from state loans into the company’s share capital.
The significance of this decision is further underscored by Croatia Airlines’ business results in the current year. In the first three quarters, the national carrier recorded a net loss of EUR 20.9 million, with an operating loss of EUR 21.5 million. Although the company achieved a positive EBITDA of EUR 12.4 million over the same period, a strong summer season was not sufficient to reverse the overall negative financial result, further confirming that Croatia Airlines’ challenges are not solely linked to the ongoing fleet transition.
The structure of the capital increase itself clearly indicates that it largely represents a financial restructuring of existing obligations to the state. As early as 2025, the conversion of EUR 43 million in claims from existing loans into share capital is planned, alongside the issuance of 43 million new shares. In 2026, a further conversion of approximately EUR 43 million in principal and interest is envisaged, combined with an additional cash injection of EUR 35 million, while another cash capitalization in the same amount is planned for 2027.
The Government justifies its decision by pointing to the fact that Croatia Airlines is in the midst of the largest project in its history, the complete replacement of its fleet with new Airbus A220 aircraft. The process began in 2024 and is scheduled to be completed by 2027, with six of the total 15 ordered aircraft delivered by the end of August this year. Minister Butković noted that the challenges of the transition period, further exacerbated by disruptions in global supply chains and delivery delays, have resulted in increased cost exposure for the company.
At the same time, Croatia Airlines’ operational plans do not currently indicate a significant expansion of its network. In the summer schedule for 2026, the national carrier has so far announced only two new routes, both of a seasonal nature. This limited scope of growth stands out particularly in the context of multi-year state capitalization and fleet renewal, and raises the question of whether the new Airbus A220 fleet will be used as a foundation for a genuine market expansion or primarily as a tool for rationalizing the existing scale of operations.
In this context, the current capitalization primarily represents a measure aimed at stabilizing the balance sheet and ensuring business continuity during a demanding transition period. Whether, in combination with the new fleet, it will lead to a long-term financial turnaround will depend прежде svega on the company’s future business and market decisions, the real effects of which can only be assessed after the fleet transition has been completed.
