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Garuda net loss widens in first half as extended curbs bite
The flag carrier's average daily passenger count plummeted to 2,000 after the government started enacting emergency public activity restrictions (PPKM Darurat) in July.
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Till the next flight: An airport ground staff member guides a Garuda Indonesia Boeing 777-300 ER plane upon arriving at the Garuda Maintenance Facility in Soekarno Hatta International Airport in Banten on June 19, 2015. The national flag carrier is facing a debilitating crisis in the wake of the COVID-19 pandemic. (JP/Jerry Adiguna)
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ational flag carrier Garuda Indonesia saw its net loss swell 25 percent annually to US$902 million (Rp12.87 trillion) in the January-June period this year as prolonged mobility restrictions greatly hit passenger air travel.
In its latest financial report, Garuda said its revenue dropped 24 percent year-on-year (yoy) to $696.8 million in the first half, led by a near halving in passenger airline services to $375.3 million.
Garuda’s average daily passenger count plummeted to 2,000 after the government started enacting emergency public activity restrictions (PPKM Darurat) in July — compared to 12,000 before the policy. Restrictions have been extended and modified several times, with the latest, looser version slated to end on Monday.
“The implementation of restrictions on community mobility in line with the soaring COVID-19 cases in the country had a significant impact on the air transportation service business, including Garuda Indonesia,” Garuda president director Irfan Setiaputra said in a statement on Tuesday.
Read also: Business insolvency lawyer appointed Garuda president commissioner
Domestic and international air travel demand took another hit this year as Indonesia imposed several types of mobility restrictions, including a mudik (exodus) travel ban, while other countries restricted inbound travel. This included Saudi Arabia for pilgrimage flights, which is a big source of revenue for Garuda.
Garuda responded with several cost-cutting measures, namely renegotiating aircraft leases, adjusting flight routes and conducting early retirement programs, which resulted in a 15.9 percent yoy drop in expenses to $1.3 billion in the first half.
