"optimistic the group will have positive operating profits"
The former executive chairman of Rex Airlines, Lim Kim Hai, has admitted to all alleged contraventions brought by ASIC regarding failure to disclose the airline's true financial state in 2023. The admission occurred on the third day of a trial in the Supreme Court of New South Wales.
The Admission
In February 2023, Lim was aware that Rex was facing an operating loss, but signed off on a statement to the ASX claiming the company was "optimistic the group will have positive operating profits" for the fiscal year.
Publicly traded companies are required to keep the market informed of major developments affecting their finances. The airline later recorded a major loss for the year and was placed into administration in July 2024 with $500 million in debts. It continues to operate under new ownership.
Legal Scope
Lim's admissions do not cover the other non-executive directors: former federal transport minister John Sharp, Lincoln Pan, and Siddharth Khotkar, who are defending the allegations.
Lim will request the court to impose pecuniary penalties and disqualification orders.
Timeline of Collapse
- July 2024: Rex entered administration with $500 million in debt.
- September 2025: The airline was delisted from the ASX.
- Government intervention: The Australian government provided up to $80 million in loans to ensure continued regional flights and assumed $50 million of debt from Rex's largest creditor.
- New ownership: US-based regional carrier Air T was named as the buyer for Rex, with the government becoming the principal secured creditor of the airline's fleet.