Gan Airport Operator Gets Adverse Audit Opinion as Accumulated Losses Reach MVR817 Million

The Auditor General’s Office has issued an adverse opinion on the 2025 financial statements of Addu International Airport Private Limited, the state-majority company that operates Gan International Airport in Addu City.

In the audit report dated 21 October, Auditor General Hussain Niyazy said the statements do not give a true and fair view of the company’s financial position at 31 December 2025, or of its financial performance and cash flows for the year, under IFRS Accounting Standards.

The government holds 70% of the company’s shares and Kasa Holdings Private Limited holds 30%, according to the notes to the statements. The company’s board approved the statements on 18 October.

Three Grounds for the Opinion

The report gives three reasons. First, the company carried the airport’s property, plant and equipment at MVR449.7 million. It had made losses for several years and, at the end of 2025, had accumulated losses of MVR817.5 million and negative net assets of MVR58.2 million. The auditors said these conditions indicated possible impairment, but the company had not assessed the assets’ recoverable amount. As a result, they could not determine whether the values should be reduced.

Second, the company offers staff lump-sum payments under a redundancy and early leavers policy, but has not accounted for it as a defined benefit plan under IAS 19.

Third, the company signed an agreement with the government on 5 March 2023 to redevelop Gan International Airport. The auditors said it has not recognised the project’s assets as capital work in progress and has not made sufficient disclosures about the project’s financing and capital commitments. The company’s own note on commitments states that there were no material capital commitments approved or contracted at the end of the year.

Then-President Ibrahim Mohamed Solih launched the airport expansion project on 4 June 2023, saying it would be developed to serve 1.5 million tourists, according to the President’s Office.

Jet Fuel Drives Revenue

Revenue rose to MVR94.4 million in 2025 from MVR33.0 million in 2024. Jet fuel sales accounted for MVR72.9 million, up from MVR13.6 million. The cost of jet fuel rose to MVR66.6 million from MVR9.9 million.

Excluding jet fuel, revenue rose about 11% to MVR21.5 million. Landing fees were MVR3.9 million in both years, and passenger service charges were about MVR1.2 million in each year. Ground handling charges rose to MVR9.6 million from MVR6.9 million.

The annual loss narrowed to MVR68.7 million from MVR78.7 million. Staff costs fell slightly to MVR46.2 million. Fines and penalties rose to MVR4.5 million from MVR3.3 million; the notes do not say what they were for.

Shareholder Support

The notes state that current liabilities exceeded current assets by MVR312.8 million, which they say indicates a material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern. They say the shareholders have confirmed in a letter of comfort that they will continue to provide financial support.

In 2025, the government advanced MVR34.6 million for share capital, which the notes say was mainly used to cover operating expenses, and MVR44.9 million to repay a Bank of Maldives loan. Because the government’s contributions exceed the shares that can be allotted to it, MVR97.2 million is now recorded as a shareholder loan. Kasa Holdings has lent the company MVR55.7 million.

The Bank of Maldives loan, taken in 2013 for the first phase of the airport’s development, stood at MVR99.4 million at the end of 2025, down from MVR152.7 million a year earlier. Under terms revised in 2020, the remaining balance is due in full in September 2027. The loan is secured on the airport’s assets and guaranteed by the government and Kasa Holdings in proportion to their shareholdings.

The company also owed MVR195.3 million to the Finance Ministry under a payment agreement signed in November 2023, and MVR30.2 million to Fenaka Corporation. It leases Gan from the Finance Ministry for 50 years from July 2011 at MVR100 a year.