Sri Lankan Airlines is now making operational profits and this trend would continue said Sri Lankan Airlines Chairman Nishantha Wickramasinghe. Speaking at the Pro Surf Championships here he said that one of the main reasons for this is the ‘oil factor’ which is at manageable levels and also prudent management tools that were implemented recently.
He said at times they were purchasing fuel at around $ 140 a barrel and today this has come down to an average of around $ 100 which he said was good.
He said the airline is also maintaining 89% cabin factor which too has helped the airline to make operational profits. “Globally, the airline industry operates on thin margins.” said the Chairman and identified China, the Far East and India as their best routes.
He however admitted that they still have to repay several overdue loans and this is putting a check on their overall profits.
Chairman said that they need to operate to more destinations which in return would bring down the ‘unit’ cost of the airline.
“This was the reason we added Moscow to our network and additional destinations in China. We are also looking at South Korea and Australia and would add frequency to current destinations,” Wickramasinghe said.
Commenting on their future financial plans Wickramasinghe said that they would add four new narrow bodied aircraft to their fleet by end of next January. The Cabinet recently approved US $ 500 million to increase the fleet of aircraft of Sri Lankan Airlines from 17 to 23 within the next five years.
In addition the national carrier would also retire some of the aging aircraft and look at maintaining a fleet in the average of five years. “We want to maintain 2/3 ‘leased’ and 1/3 ‘owned’ model,” he said.
Commenting on the staff he said that the airline increased the cabin crew from 600 to 900 and is planning to have 70 to 80 percent local pilots. Currently this is at a mix of 50 percent.
The Chairman also spelled out plans to refurbish the current fleet with new seats and interior decor adding more luxury to the fleet. “We would invest US $ 40 million for this from own funds,” he disclosed.
The Sri Lankan government bought back the 43.6 percent stake Emirates Airline held on Sri Lankan for US $ 55 million last year. During the time no capital infusion were to improve the SriLankan Airlines.