SriLankan Airlines records its first profitable fourth quarter (Q4) since 2006 for the financial year that ended on March 31, 2022 with a group net profit of USD 1.7 million despite pandemic challenges.
The airline was able to achieve this financial turnaround through various measures in its 2021-22 financial year including scaling down staff costs and overheads; renegotiating supplier contracts; increasing cargo revenue; and creating an ambitious growth plan capitalizing on pent-up travel demand.
The initiatives paid off, with SriLankan making its first monthly profit since the onset of COVID-19 in December 2021 and continuing with a profit in the final quarter. The airline now has accumulated over USD 12 million in profits over the last 4 months as traffic has returned after the pandemic. SriLankan’s expansion initiative saw the launch of flights to several new destinations in the last year including Seoul; Moscow; Kathmandu and Paris. Frequencies were also gradually increased across the airline’s network in line with the recovery of the global travel industry and demand.
The airline is now back to 75% of the passenger revenue it made pre-pandemic in Q4 of 2019-20.
Correspondingly, passenger numbers also rose to nearly 700,000 for the quarter. The airline is making strong headway towards matching pre-pandemic levels as demand for international travel recovers.
The payoff is not limited to the airline, as it remains by far the largest carrier of tourists into Sri Lanka. SriLankan is also a net foreign currency earner for the country owing to a sizable share of its revenue being generated from international markets. Chairman of SriLankan Airlines Ashok Pathirage, (pictured) stated, “I am pleased to note that we ended 2021-22 on a high note, given our first quarterly profit in many years. The passenger demand remained strong, and revenues continued to recover from the setbacks of the pandemic during the quarter. Our annual expenditure remained within expectations.”
“We anticipate some headwinds in the first half of this financial year with high fuel prices and a short-term dip in demand to Sri Lanka. We have factored in these challenges and are working towards minimizing the impact with a strong business plan and a sound turnaround strategy to return to full-year profitability,” added Richard Nuttall, Acting Chief Executive Officer of SriLankan Airlines.
“Traffic is expected to recover fully by the end of the year as travel restrictions are eased off further. We will continue to support the tourism industry of Sri Lanka and be a catalyst for economic recovery.”