SriLankan achieves significant profits
SriLankan Airlines Limited and the SriLankan Airlines Group both
achieved significant profits during the last financial year, despite a
sharp downturn in Sri Lanka's tourism industry and a steep rise in the
price of aviation fuel.
Tourist arrivals slowed down as foreign governments issued travel
advisories against visiting Sri Lanka, following the escalation of
hostilities in the country's internal conflict which placed the country
and its capital under security threats.
The average price of jet fuel reached USD 82 per barrel in 2006, as
against USD 71 in 2005. As a result, the annual fuel bill of the company
increased to USD 224.9 million from USD 190.5 million in the previous
year, an increase of USD 34.4 million or 18%.
Chairman, SriLankan Airlines D.H.S. Jayawardena said; "This financial
performance was made possible by the tireless efforts of the management
and staff of SriLankan Airlines and SriLankan Catering to mitigate the
impact of adverse factors through innovative and efficient business
strategies and stringent control of costs.
The financial year under review was so far the most challenging year
for the airline in its twenty-seven year history."
The Group achieved a Net Profit After Tax of Rs. 862.18 million for
the financial year 2006/07, down 50% from the previous year.
It was the fifth year in succession that the Group, which consists of
SriLankan Airlines Limited and its fully owned subsidiary SriLankan
Catering (Pvt) Limited, recorded a profit. The company, SriLankan
Airlines Ltd, made a profit of Rs. 568.04 million, an increase of Rs.
91.51 million over the previous year's Rs. 476.53 million (restated).
Managing Director Tim Clark, said: "The largest single factor that
affected the airline's bottom-line was the return to hostilities in Sri
Lanka's internal conflict. The resultant travel advisories against
visiting Sri Lanka brought very serious consequences on traditional
markets such as Japan, the United Kingdom, Germany and France."
CEO, Peter Hill said: "The SriLankan Airlines Group has now been
profitable for seven of the nine years since privatisation.
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