SriLankan for full re-fleet despite Rs 130 b loss- Report

SriLankan Airlines (SLA) will embark on a re-fleeting programme despite its accumulated losses reaching a staggering Rs 130 billion by April this year. In the first four months of this year alone, the Airline recorded a loss of Rs 4.9 billion, adding to its already heavy losses, according to the Midyear Fiscal Position Report of the Finance Ministry presented to Parliament recently.However, the same report states that SLA will embark on a re-fleeting programme to replace the entire wide body fleet with a new fleet to improve opera- tional efficiencies and provide modern passenger comforts with a view to attract around 55% of the passengers flying into Sri Lanka, while increasing its revenue to be a commercially viable entity.

The report also said that the Government has decided to prepare a viable and comprehensive business plan for SLA and Mihin Lanka Ltd, and amalgamate them due to the huge losses they have incurred.

During the first four months of this year, SLA’s revenue was Rs 39.6 billion, while its expenditure for the same period was Rs 44. 9 billion.

Meanwhile, the report revealed that the total foreign borrowings of Airport and Aviation Services (Sri Lanka) Ltd. (AASL) as at April 30, 2015 stood at Rs 35,747 million. “The Company paid Rs 371 million for the first four months of the year, to service seven foreign loans obtained through the General Treasury.

AASL will commence servicing the loan of US$ 190 million for the construction of the Mattala Rajapaksa International Airport, in the future,” the report added.

AASL was able to record an operational profit of Rs 1,475 million in the first four months of the year, which is a 5% increase for the same period in 2014, the report said.