Oct 02, 2008 (LBO) – Sri Lankan Airlines has significantly reduced losses in July and August and is confident that the red ink can be contained for the rest of the financial year, its chief executive Manoj Gunawardena says.
The national carrier’s bottom line has been weakening since the end of the June 2008 quarter mainly because of high fuel costs and increased competition, especially from the once lucrative Indian sub-continent market, Gunawardena said.
These factors badly affected its core airline operation business, even though ancillary businesses like catering, onboard sales, ground handling and maintenance operations on which Sri Lankan has a monopoly remained highly profitable.
In March this year the airline reported profits of 4.8 billion rupees with gains from aircraft sales, though core airline operations lost 6.1 billion rupees.
In the quarter to June the airline had lost 4.6 billion rupees, with core operations losing 5.6 billion rupees.
“So when I say we made a loss from our airline operation in eight out of our ten years it does not reflect the whole company,” Gunaw