What the Administration Board and the General Manager explain Mihail Kogalniceanu International Airport in a financially unstable situation

The financial situation of the National Society Mihail Kogalniceanu International Airport S.A. is critical. This is what a black and white report issued by the companies’ verification and monitoring society RisCo states.

According to the RisCo report, “the  National Society Mihail Kogalniceanu International Airport S.A. is in an unstable financial situation. The operating and net profitability levels, as well as the current debt situation are at levels indicating operational and financial risks. There’s the possibility for the company to face difficulties in the next period in providing the providing the necessary liquidity to ensure proper operations.  We recommend careful monitoring of the financial situation of the company and of the progress of the monthly financial indicators”.

Over the last three years, 2011, 2012, and 2013,  Mihail Kogalniceanu International Airport (AIMK) recorded only losses. From the same RisCo report, under the Cash Flow section, we learn that in 2011 the company had registered losses up to 110.352 lei, in 2012 loss amounted to 1.393.064 lei and in 2013 the registered loss was of 3.844.509 lei. In other words, in just one year, the company losses tripled! Curiously enough is the fact that the loss peaked in 2013, the year when Cristian Moldovanu was appointed General Manager, former spokesperson of the County Council. Moreover, at the beginning of February 2014, while the company was already under the management of Cristian Moldovanu, Ryanair, the most important low-cost airline in Europe has decided not to operate on the Mihail Kogalniceanu International Airport (AIMK). Would it be the case of bad management?!?

“The company shows high risk and may face losses.”

The RisCo report established under the Performance Indicators chapter the following: „The net profit margin is very low compared to the industry the company belongs to. The company shows a high risk taking into consideration it can easily enter losses.”
The margin of the operating profit is very low compared to the industry it belongs to. The company presents a high risk given the fact that operational profitability is very low and can easily turn into loss.

The turnover evolution is much weaker than the turnover of the industry to which belongs. The company shows a high risk since it fails in following the development trend of the segment to which it belongs.

The return on assets is very low when compared to the industry of which it belongs and the net profit obtain is very low compared to the company’s assets, which indicates a low competitiveness or adverse economical period.

The return on capital is very low in comparison with the industry to which the company belongs and the net profit is very low compared to equity shareholders. The company does not take advantage of the existing capital.


Under the Solvency Ratio chapter, the report shows: „The overall debt ratio - the total active debt level is greater than the industry’s average. The company has reduced own capitals and this is a sensitive aspect which may affect maintaining the financial balance.
The financial leverage degree – the debts engaged to banks and financial institutions have a significant ratio in the overall active, and the indebtness is higher than the average in the industry the company belongs to.

The debts coverage degree – the profit resulted from the current activities of the firm cover a narrow extent of the total debt, and the firm may face major problems in reimbursing them. This indicator is significantly smaller than the average of the industry.
Under the Efficiency Indicators, the extent of the period of collection from customers – the company collects for the issued invoices over a much longer interval than the industry average. Collection of claims over extended deadlines generates the lack of liquidity and financial imbalance.

Under the Suppliers’ Payment Deadline – the firm pays the suppliers within shorter periods than the industry average. Payment over a shorter period can lead to lack of liquidity and potential financial imbalance”, the RisCo report says.
In this respect, it is also said that: “the company registers stocks and claims much higher than the annual turnover. This means a collecting period of over a year.”


“The RisCo reports are purely informational and they are not to be considered an advice, recommendation, offer or invitation to purchase or subscribe to goods or services and they cannot constitute the foundation of conclusion or termination of a contract or of a commitment of any kind, nor represent a warranty in respect of minimizing or eliminating certain risks associated to the user’s activity”, the RisCo representatives add.

The laconic reply of the manager of the airport

When asked about this RisCo report, Cristian Moldovanu, the airport manager, didn’t want to comment. Instead, he stated that “over the first semester of 2014 the overall performance indicators overcome 6.32%.”

Who is Cristian Moldovanu, the airport manager

The Administration Board of MK International Airport (AIMK) elected in June 2013 Cristian Moldovanu, former spokesperson of the Couty Council, as General Manager. Moldovanu was a member of the shareholders’ general assembly (AGA) of AIMK from 2008 to September 2012, as representative of the County Council. He had resigned from the County Council in September 2012. Cristian Moldovan is a law school graduate. He got employed by the County Council after working for Radio Neptun and Jurnal de Constanta, in 2004. At the time he was employed, he was 40 years old and he was writing in his CV that he had studied for three years within the Electronics and Telecommunications Faculty in Bucharest, without giving his dissertation. So, he becomes the spokesperson of the County Council and, in December 2007, being proposed by the president of the institution, Nicusor Constantinescu, he is appointed County Council representative within the General Assembly of the Shareholders of the National Company Mihail Kogalniceanu International Airport. The appointment was made taking into account that the County Council has just taken over 20% of the airport shares.

The wealth and interests of Cristian Moldovanu

According to the 2014 statement of interests filled in by Cristian Modovanu, he owns together with his wife, three urban terrain lots and another lot for agricultural purpose of 679 sq.m situated in Constanta County. His wife also holds a 50% share ratio in three houses. The International Airport General Manager drives a Mitsubishi car manufactured in 1994. Finally, Cristian Moldovanu has a debt of 7,000 euro, due to 2018. Last year he registered revenues of 80,534 lei from the Mihail Kogalniceanu International Airport and his wife registered revenues of 20,311 lei from the County Council.

Why the low cost company Ryanair left Constanta?

Starting from February this year, Ryanair, the largest low cost airline in Europe, stopped operating the Mihail Kogalniceanu International Airport (AIMK). The Irish company entered the Romanian market first in 2008 and carried over 36,000 passengers from the Mihail Kogalniceanu Airport in Constanta to two European destinations. The Ryanair departure resulted in the reduction of the income the airport obtained from airport taxes and handling. “Ryanair interrupted the Mihail Kogalniceanu flights. They did not announce any intention of operation. We did not get reply to the questions we asked. We aren’t anymore in the Ryanair flight charts”, declared at that time Cristian Moldovanu, airport manager. In turn, the representatives of the low cost company motivated their withdrawal from the International Airport Mihail Kogalniceanu due to the aircraft shortage.

What does the Administration Board of the airport says

According to a RisCo analysis Risco, the company would find itself in an instable financial situation. "It is possible for the firm to face in the next period difficulties in providing necessary liquidity to support optimal operations," RisCo says. What do the members of the Administrative Board of the Mihail Kogalniceanu International Airport say about this situation?
Well, Iurin Pancencu, Board member, claims that “the situation is not as it appears”. “The company is OK, there aren’t any financial problems” has declared Pancencu for ZIUA de Constanta Daily Newspaper.
Dumitru Nancu, the Chairman of the Board has declared he is not familiar with the analysis and therefore a situation as such. “I did not see the report, I do not know what is it about and I do not have these data”.
Constantin Teodorescu either refrained from commenting on the situation, saying that he hasn’t the necessary data. “I cannot comment at this time as I don’t have the necessary data. “I cannot comment at this moment, I don’t have all the data to discuss about an accurate prognosis”.
Relatively more generous with his declarations was Dan Weiler, member of the Board as well. He disputed the RisCo analysis, stating very clearly that “the company’s situation is very good, even better than last year”. “The company has exceeded the performance indicators in the first six months”, Weiler has added.
We mention that the Administration Board includes as members Cristian Moldovanu, the general manager of the international airport and Ion Madalin Marinescu as well, and the latter couldn’t be contacted.

Official data from the Trade Register

The National Society Mihail Kogalniceanu International Airport Constanta S.A. was founded in 1998 and is headquartered in Mihail Kogalniceanu, Tudor Vladimirescu Street. The social subscribed capital is 1,157,950 lei fully paid, consisting of 115,795 shares, in value of 10 lei each. The value of the in-kind contribution is of 1,157,950 lei. The shareholders of the company are the Constanta County Council which owns the 23,159 shares with a 20% market share of participation in profits and loss, the Romanian State which owns the 69,477 shares, with a 60% market share of participation in profits and loss, and the Property Fund, which owns 23,159 of shares, with a 20% share of participation in profits and loss.
The administrators of the National Society International Airport Kogalniceanu S.A. are Moldovanu Mihai Cristian Carsium, born in 1963 in Harsova, servicing as general manager and member of the Administration Board, Marin Eugen, born in 1962 in Bucharest, member of the Administration Board, Marinescu Ion- Madalin, born in 1975, in Curtea de Arges, member of the Administration Board, Pancencu Iurin, born in 1969 in Tulcea, member of the Administration Board, Nancu Dumitru, born in 1979, in Babadag, Tulcea County, member of the Administration Board, Constantin Teodorescu, born in 1952 in Constanta, a member of the Administration Board, Dan Weiler, born in 1950, in Bucharest, member of the Administration Board.

The Independent Union hopes for a budget amendment

Cristian Fotu, the president of the Independent Trade Union of AIMK, organization which currently counts 190 members, states that there are several months during which there weren’t any more trouble with paying the salaries. "The case opened in the court of law by the Union for the wage rights had reached the conclusion. The court’s decision will be drafted in September and the next days the remaining payment will be made”, Fotu has declared. Initially there have been outstanding salary rights amounting to 6 billion lei (value before the denomination), but the amount had suffered modifications because some of the outstanding claims were paid over time. We recall that in October last year the employees of the Mihail Kogalniceanu International Airport threatened they were taking the strike into account because they did not receive their wages on time. At that time, Cristian Moldovanu, the general manager of AIMK acknowledged that “people are right, it is normal to get upset”, but also that “the situation isn’t that disastrous”. Fotu also wanted to mention that the Union, whose leader he is, finds currently in negotiations for the collective labor agreement. "We are going to get the simulation to the requested amounts, but both the Union and the airport management have made substantiation notes and submitted them to the Ministry of Transport for the budget amendment.

The Free Union is silent

There were tensions not only between the Free Union and the AIMK management, but also between the latter and the Free Trade Union led by Emanuel Roiu. In this regards, we note that in 2014 the Free Trade Union sued the airport management opening filling a case for the financial rights. We contacted Emanuel Roiu by phone asking for his opinion in regards of the situation the company currently faces in respect of the salary payment, but he declared he could not speak.

The independent assessor Ronial Expert SRL, about the financial situation in 2013

On the company’s website there has been published a report of the independent assessor Ronial Expert SRL, for 2013. Following the financial analysis, the independent auditor issued the following conclusions:
“The National Society Mihail Kogalniceanu International Airport S.A. reports on 31st of December 2013 claims related to un-paying clients, registered as long standing “regular customers” presenting a significant risk of not collecting, worth 1,075,027 lei. The company also recorded doubtful debts (contentious) worth 312,586 lei, some of which are the subject of ongoing trials in the court of law, with a serious risk of not collecting. In this respect, we mention that the company didn’t proceed to the assessment of the claims referred to the probable receivable adjustments receivable didn’t establish the impairment allowances for the amounts that they cannot collect, as stipulated by the Order of the Minister of Public Finance no. 3055/2009 for the approval of the accounting regulations. During the assessment period, at the proposal of the independent auditor, the company proceeded to the formation and registration of depreciation adjustments for the value of 92,059.94. Following the assessment mission, it was recorded under loss of receivables, the amount of 56,599.16 USD, related to claims with 0 collecting probability.
The company reports on the 31st of December 2013 claims worth 5,159.64 lei related to four not collected customers and obligations worth 556.10 lei to a provider, with maturities that exceed three years, for which there has been not exercised any legal action or steps for the recovery or payment of the respective amounts.  Thus, for the mentioned claims and the obligations toward the provider, operate the effects of general prescription, under the Civil Law Code of Procedure. It was found that the company did not act for the application of the accounting and tax treatment, meaning the removal of the receivable amounts, respectively duties and the concurrent registration in accounts under “Other operating expenses” and “Other operating income”, the report of the independent auditor Ronial Expert SRL shows.

The dispute with the Airport’s Free Trade Union

The report issued by the independent auditor SC Ronial Expert SRL also states the fact that the ‘company has been part of the labor dispute with the Free Trade Union of the Mihail Kogalniceanu International Airport, according to 4292/118/2010 case. The case was filed as a request of the representatives of the AIC-MK union members for ensuring the service uniforms under the terms in the collective labor agreement valid in the company.  According to the definitive rule issued by the court on the 25th of June 2013, the company was compelled to provide the uniforms for the employees within the emergency situations service, for a total of 20 plaintiffs. Given the company obligation to provide the requested work uniforms, the quantification of the respective sum was not done and it did not reflect in the balance sheet concluded on the 31st of December 2013. The company hasn’t reported in its balance sheet the value of the legal case obligations and the costs of the enforcement as well”, the independent auditor’s report shows.

Dubious insurance policy

“In 2013, the company recorded under costs the sum amounting 23,894.38 lei representing the insurance policy no 1780/31.05.2013, signed with SC Omniasig Vienna Insurance Group SA, having as subject the insurance of the takeoff/landing platform. Within the insurance policy there were not clearly and precisely stated the insurance risks for the mentioned asset, fact calling into question the supporting role of the contract, as well as the recognition of the respective expenditure. We also note that the deductible character of the amount of 23,894.34 lei isn’t ensured, as the expenses do not relate the taxpayer’s assets. The company is subject of various pending litigations before the courts of law, and on the completion of their materialization on adverse ruling of the courts could generate an adverse effect on the financial position and the balance of the financial year in which the definitive court decisions will be taken”, it is also said in the conclusions of the independent auditor SC Ronial Expert SRL.