TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Garuda needs year to achieve financial stability: CEO
Change Size
A Garuda Indonesia aircraft is seen at Terminal 3 of Soekarno-Hatta International Airport in Tangerang, Banten. (Tempo/Tony Hartawan)
S
tate-owned carrier PT Garuda Indonesia needs one year to stabilize its financial situation after suffering losses of Rp 1.31 trillion (US$ 98.55 million) in the first quarter of 2017, Garuda president director Pahala N. Mansury has said.
“The liquidity, balance of payments and other indicators remain positive until the end of this year. We hope to achieve stability by the end of next year. The recovery period could take nine to 12 months,” said Pahala in Jakarta on Sunday as quoted by kompas.com.
He said Garuda Indonesia’s losses were mainly caused by the price hike in aviation turbine fuel (avtur) as spending on the fuel rose last year by 54 percent from $189.8 million to $292.3 million.
The fuel price increase, among other factors, increased operational costs from $840.1 million to $1.1 billion. The 6.2 percent increase in the company’s revenues from $856 million to $909.5 million could not compensate for the increased costs.
In trying to improve efficiency, the carrier is currently reviewing 10 to 20 of its domestic routes, said Pahala, adding that Garuda was trying to improve its financial conditions amid rumors of fundamental problems.
“The losses in the first quarter of 2017 are an opportunity to improve our performance,” said Pahala, while denying that his company was in severe difficulties. (mrc/bbn)
