SriLankan Airlines makes no loss on repatriation flights
SriLankan Airlines is facing a number of hurdles in overcoming its financial losses as they garner revenue off repatriation of nationals stranded overseas amid the COVID-19 pandemic.
The national carrier has repatriated 7800 Sri Lankans stranded overseas so far with no loss to the airline as the costs were covered in full, SriLankan Airlines’ Chairman Ashok Pathirage said at a media briefing in Colombo on Monday.
Mr. Ashok Pathirage
The airline still has to bring down a further 30,000 Sri Lankans living overseas, he said.
He noted that the airline continued to make losses and its plan to turnaround the company in one year will be stalled under the circumstances and in this respect they will be looking at borrowing from foreign funds in future.
“We want to borrow from overseas and at the moment we are talking” to some foreign funds, he said.
Earlier he explained that the current debts of the airline will be restructured by the two state banks from whom they have heavily borrowed.
Currently they owe US$187 million to the People’s Bank and $220 million to the Bank of Ceylon, he said adding that they owe $275 million to the Ceylon Petroleum Corporation (CPC). The airline made a loss of $130 million last year, he noted.
Further the government has given a sovereign guarantee where the airline can raise $75 million.
The government has also agreed to remove the Withholding Tax (WHT) that would generate a savings of $30-40 million per annum, Mr. Pathirage noted.
The airline would reconsider the markets they fly to as well looking favourably at resuming operations to Frankfurt and Sydney in addition to increase their channeling of tourists from countries like South Korea, Melbourne, Sydney and the Maldives.
Following staff reductions by about 900 and salary cuts the airline has saved about $30 million per annum, the Chairman said.
He explained that currently since they continue to have an excess staff they would consider reducing further.
In this respect, they hope to obtain the relevant approvals to introduce a Voluntary Retirement Scheme (VRS) that would enable the airline to reduce staff by another 500. Currently the airline has a permanent cadre of 6000 employees.
By December the company hopes to resume about 40 per cent of its normal operations and by next March get back to normal by about 70 per cent.