Sweeping measures to ensure survival
SAS announced a net loss of €592m (SEK6.3bn) for 2008 compared with a profit of €59.6m (SEK636m) for 2007.
At the same time the Scandinavian carrier announced a raft of measures, including redundancies, to cope with the economic downturn.
The airline in which the Swedish, Danish and Norwegian governments have a stake, said its revenue for 2008 rose from €4.745bn (SEK50.6bn) to €4.979bn (SEK53.2bn).
But pre-tax income showed a €97.7m (SEK1bn) loss compared to a €97.7m profit for the previous year.
For the fourth quarter, SAS said it had suffered a drop in revenue from €1.217bn (SEK13bn) to €1.209m (SEK12.9bn).
It also suffered a pre-tax loss of €37.7m (SEK403m) compared to a €5.3m (SEK57m) profit in 2007 and a net loss of €258m (SEK2.8bn) against a loos of €55.8m (SEK596m) for the same period ion 2007.
Mats Jansson, the airline's president and ceo, said: "2008 will probably go down in history as one of the most challenging and turbulent years that the entire aviation industry has ever experienced.
"During the year, we saw a period of record-high oil prices, a financial crisis that heavily intensified during the final quarter and which led to an economic recession in many markets that has significantly reduced demand for goods and services."
He said the new strategy, Core SAS, was a five point plan to see the airline through the current tough times.
These included 3,000 redundancies as well as a further 5,600 staff leaving the company as operations are either sold or outsourced.
SAS said it planned to sell Spanair, which was agreed last week, and sell its holdings in airBaltic - also agreed - UK carrier bmi, Air Greenland, Estonian Airways and Skyways.
The airline's ground services, technical services and cargo operations would also be discontinued or outsourced.
Its network would be cut to enable it to focus on profitable routes and on the business travel market.
The programme would see savings of €252.7m (SEK2.7bn) and a further saving of €121.7m (SEK1.3bn) from "collective agreement negotiations."
To launch the new measures, Mr Jansson said the airline was seeking a €561.5m (SEK6bn) rights issue.
He said: "Core SAS" contains a number of changes, which combined, will make SAS profitable and competitive.
"In addition to implementing a new, streamlined organisation, in combination with extensive structural changes, considerable reductions to the Group's fleet and route network will be made.
"A total of a further 14 aircraft will be withdrawn within the framework of "Core SAS."