Ex-Rex boss admits hiding news of airline’s financial woes

The former executive chairman of Rex Airlines has capitulated just days into a major trial and admitted to failing to disclose the airline’s true financial state in 2023 before its ultimate collapse a year later.

The former Rex executive chairman Lim Kim Hai admitted “to all alleged contraventions against him”, the Australian Securities and Investments Commission said on the third day of a trial brought by the corporate regulator against the company and four former directors.

Lim was aware Rex faced an operating loss in February 2023 but instead signed off on a statement from the company to the ASX saying it was “optimistic the group will have positive operating profits” for the fiscal year.

Publicly traded companies have a duty to keep the market informed of major developments that affect their finances.

The airline later recorded a major loss for the year, and was placed into administration with $500 million in debts. It continues to fly its planes under new ownership.

“Former Rex executive chair Lim Kim Hai admitted, in the Supreme Court of New South Wales, to all alleged contraventions against him,” ASIC said in a statement.

Lim’s admissions do not cover any of the other non-executive directors, former federal transport minister John Sharp, Lincoln Pan and Siddharth Khotkar, who are defending the allegations against them.

Lim will now ask the court “to impose pecuniary penalties and disqualification orders, as well as other orders”, because of his admissions. Lim and ASIC have agreed on penalties from his admissions, but they have not been disclosed and must be approved by the court.

The breaches Lim was accused of come with penalties of up to about $1.35 million each.

Now that Lim, who is based overseas, has admitted liability, he would no longer be able to claim a legal right to refuse to testify against his co-defendants. In that circumstance, ASIC may try to force Lim to give evidence against his former colleagues on the board.

Justice Ashley Black gave ASIC until Thursday at 10am to file applications to require Lim to give evidence.

On Monday, lawyers for ASIC argued Rex Airlines directors knew the failed airline had published an “unreasonable and unsupportable” profit forecast in February 2023 before reversing course and revealing a $35 million loss weeks before the end of the financial year in June 2023.

In July 2024, Rex tipped into administration with $500 million in debt. It was delisted from the ASX in September 2025, with the Albanese government stepping in, providing up to $80 million in loans, to ensure the airline continued flying its routes to regional Australia, where it provides a key service for communities.

The government also assumed $50 million of debt from Rex’s largest creditor, PAGAC Regulus Holdings Ltd.

After a search for a buyer, US-based Air T, a regional carrier with experience operating turboprop planes, was named as the buyer for Rex.

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