SriLankan Airlines reveals 70% revenue loss in 2020/21

Mr. Ashok Pathirage

Though SriLankan Airlines is facing grave financial shortfalls – with a revenue loss of 70 percent reported in the 2020/21 financial year - it has lauded the efforts of its employees to support the airline's operations under very challenging and trying conditions.

Airline Chairman Ashok Pathirage, in a statement, said that the beginning of the year 2021 has been a most welcome renewal of hope for everyone, especially for SriLankan Airlines as the company has been waiting patiently for international travel to resume.

Despite facing the toughest times as an airline, due to the global pandemic, 2020 and 2021 showed the airline the core of courage and resilience of its staff at SriLankan who faced the pandemic like champions both as employees and individuals, fulfilling their obligations as part of the national carrier that serves the nation, he said.

“As the nation battles with the third wave of the COVID-19 pandemic, and this time more brutally than the previous instances, it is the courage and resilience of our valued staff which helped the airline to face the gravest challenges. It is with great admiration and respect that we, the Board of Directors and the Management Team recognise the commendable contributions of our valued employees who ensured that daily operations continued without disruptions even under difficult circumstances,” he said.

The airline has explored all business opportunities to keep it afloat even though the atmosphere in the world is unfavourable. “We have introduced several measures to ensure every function of the business remained fully operational to grab every business opportunity. As new variants emerge, we are carefully monitoring the situation and we will constantly reassess our strategic plans and adjust accordingly,” he said.

SriLankan Airlines experienced a revenue reduction of 70 percent during the financial year 2020/21 when compared to the year before.

The statement said that the airline repatriated 74,032 passengers (Sri Lankans) in 229 flights from April 2020 to March 2021. However, from April to June 2021, 35,612 passengers were repatriated using scheduled flights. The airline also adapted to meet the increased demand for transportation of air cargo, resulting from the suspension of flights to Sri Lanka by other carriers.

The chairman said the airline plans to resume flights to the Russian capital, Moscow this July, with a weekly scheduled flight between Colombo’s Bandaranaike International Airport (BIA) and Moscow’s Domodedovo Airport (DME). “Using an Airbus A330 configured for 269 economy and 28 business class seats we will not only facilitate travel but will be the impetus for building closer bilateral business connections between the two countries,” he said.

The present schedule consists of a network optimizing passenger and cargo contributions to over 29 destinations. New destinations in the present schedule include Sydney, Incheon, and Nairobi with Frankfurt and Moscow to commence by the end of July. Over 60 percent of the uplifted capacity was allocated to local exports to ensure a continuous foreign currency inflow to Sri Lanka in the hope of strengthening the domestic export segment. SriLankan Airlines operated 3,039 scheduled flights and 165 cargo charters/ non-scheduled operations for uplifting Personal Protection Equipment (PPE) and essential goods connecting the Far East, Africa, the Indian Subcontinent, Europe, and West Asia since the onset of the COVID-19 pandemic from April 2020 to June 2021.

“We managed to bring down the cash burn-out substantially by approximately 44 percent through re-negotiating aircraft lease contracts to achieve both lease rent reductions and deferrals, employee-related cost savings, implementing a Voluntary Retirement Scheme (VRS), restructuring the organisation to make it leaner, cross utilised the existing cadre and job amalgamations, ceasing external recruitments other than for operationally critical vacancies, reviewing unproductive policies and practices. However, the cash burn is forecasted to continue until at least the end of this year, as we expect continued severe revenue losses from the aviation industry,” he said.

The chairman said that SriLankan Airlines has successfully rolled out vaccines administered by the airlines’ medical centre to 95 percent of its flying crew who are fully vaccinated and more than 80 percent of its operational and other staff are also inoculated.

“We expect that many countries will open their borders for air travel by the end of the year, enabling us to recommence our commercial passenger operations and begin our journey towards recovery. We will constantly reassess our plans based on the evolving nature of the crisis with appropriate adjustments. The future of SriLankan Airlines lies in rebounding passenger travel both in numeric and caliber. All our periodic targets are contingent on international air travel being restored,” the chairman said.