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Garuda set to be profitable again next year
Garuda Indonesia can look forward to almost US$400 million in net profit next year and more in the following years, the government forecasts, pointing to a turnaround for the debt-laden national flag carrier.
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Touching down: A Garuda Indonesia Airbus A330 lands at Sultan Iskandar Muda International Airport in Blang Bintang, Aceh, on July 13, 2021. (AFP/Chaideer Mahyuddin)
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aruda Indonesia can look forward to almost US$400 million in net profit next year and more in the following years, the government forecasts, pointing to a turnaround for the debt-laden national flag carrier.
Following years of hefty losses, the airline operator would achieve $399 million in profit, which would increase to $647 million in 2026, according to the Finance Ministry’s projection.
The ministry’s calculation assumes that Garuda would generate $3.6 billion in revenue next year, which would rise to $4.6 billion three years later thanks to rapid growth in annual passenger numbers to 131 million.
Meanwhile, the airline operator’s operational costs are set to be kept between $2.9 billion and $3.4 billion over the next four years.
“Looking ahead until 2026, we can see that Garuda’s profitability will keep improving,” the ministry’s state assets director general, Rionald “Rio” Silaban, told lawmakers on Thursday during a meeting with House of Representatives Commission XI, which oversees finance and the state budget.
Read also: Airlines look to bright future but high costs stand in their way
The bright projection for Garuda’s future comes just a few months after mounting liabilities pushed the flag carrier to the brink of bankruptcy, as high lease costs coincided with a sharp drop in passengers due to the COVID-19 pandemic and alleged mismanagement.
