National carrier carried highest number of passengers in its entire history in 2016/17

SriLankan Airlines carried the highest number of passengers ever in the airline’s history during 2016/17 but huge losses continued to bite the debt-burdened national carrier. Citing ‘ difficult market conditions’, the airline said on Thursday that the un- audited net group loss ( before finance and one- off charges) was Rs. 6.49 billion ( US$ 15.12 million) in 2016/ 17, sharply up from a Rs. 2.9 billion ($3.15 million) loss in the previous year. But the airline said the latest loss was a significant improvement from the deficit that had been budgeted for the year.

The total operational revenue increased to Rs. 136.68 billion from Rs.129.48 billion in 2015/16.

In a media statement, the airline said “despite these challenging conditions, SriLankan managed to control the decline in its average fares to only 3 per cent in USD terms year- over- year – a satisfactory performance in relation to many leading airlines in the world who have seen significantly higher fare declines”. The depreciation of the Sri Lanka Rupee against the US dollar had a significant negative impact on the airline, as a majority of costs in the global airline business are USD denominated. The impact of this was further exacerbated by the relatively high price of jet fuel in Colombo, where the largest share of the airline’s fuel uplift takes place.

During the last quarter of the financial year, the airline’s financial performance was further significantly and adversely affected due to the very necessary runway re- surfacing project at Colombo’s Bandaranaike International Airport – which required the airline to cancel over 600 flights during the period, the statement said.

“The airline successfully completed the integration of Mihin Lanka’s operations into the SriLankan network during the year, marking a seamless transfer conducted in a relatively short time frame. At the end of the year, SriLankan was serving 36 international destinations from its hub in Colombo, with an operating fleet of 24 aircraft”.

The airline has already announced plans to add three new destinations in India from summer 2017, thereby becoming the largest foreign airline into India by the number of cities served. The airline has already announced plans to add three new destinations in India from summer 2017, thereby becoming the largest foreign airline into India by the number of cities served. The government has been scouting around for a strategic partner to either invest and manage, or invest in the airline but the process is taking several months, contrary to earlier plans.