The national carrier SriLankan has posted an after tax profit of Rs. 4.9 billion in the final year under Emirates management that ended on March 31, 2008, according to its just released annual report in the run-up to the airline’s AGM due on August 19.
But perusing the notes to the accounts reveal that it would have in fact been a massive loss if not for more than five billion rupees realised from the sale of its last three aircraft, all long range wide-bodied Airbus A-340s acquired by the airline in the mid-1990s.
In fact Emirates had shown profits in the airline under its management even in previous years by systematically disposing of the nine aircraft the national carrier owned at the time its management was handed over to Emirates in 1998.
It was earlier reported in late 2007 that these last three aircraft had been sold to a company in Mauritius after the buyer itself valued the aircraft and after the sale the same aircraft were leased back by SriLankan.
With runaway fuel prices accounting for as much as 55 per cent of its expenditure, the carrier’s new Chief Executive Officer Manoj Gunawardena in his CEO’s review to the annual report has announced the adoption of a series of cost cutting measures, including reducing frequencies on less profitable routes, curtailing of corporate sponsorships and advertising, adopting fuel conservation measures and shifting of airlines operations to Katunayake.
The carrier has already shifted some of its divisions like Finance to Katunayake. “The key dividend from this will be to bring all decision-making under one roof to improve efficiency and competitiveness. This will also reduce the cost of rental in Colombo’s World Trade Centre”, Mr. Gunawardena said.
The CEO concedes in the company’s Business Turnaround Plan 2008/09 that the airline recorded a loss of Rs 6.1 billion (US$57million) from its core business in airline activity during the year under review.
Interestingly the CEO has listed among measures to be introduced to improve its performance a new policy on corporate whistle blowing to encourage reporting by staff of unsafe, unsound and unprofitable practices.
“This would provide added incentives for staff to involve themselves in the decision making process, in addition to the company’s present ‘suggestions and rewards’ schemes in this area,” he said.
But unions are asking what the management did after the recent detection of a foreign pilot who had gained employment as a Captain after submitting fraudulent papers regarding his experience and qualifications.
They said in any Western country if he had pulled a similar stunt he would have been charged for attempted manslaughter for endangering lives of innocent passengers, but in this instance the airline had not even lodged an entry with police for submitting fraudulent papers by this European. It had only complained to recover some US$15,000 it had incurred to train him and the man had readily paid the sum.
Unions also charge that those responsible for blindly recruiting the man without any cursory checks on his background too have been allowed to go scot-free with what they called was a "dubious internal probe." | 
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