What's new

PIA continues its flight in the red

ziaulislam

ELITE MEMBER
Apr 22, 2010
23,712
9
23,107
Country
Pakistan
Location
United States
Lower fuel cost and a cut in administrative expenditure was not enough to stop the financial hemorrhage of Pakistan International Airlines (PIA), which recorded a net loss of Rs32 billion in 2014.

Despite recording an improvement over the previous year when the national flag carrier booked a record loss of Rs44 billion, the continuous ride in the red shrouds its future, according to financial results released on Tuesday.

Net sales rose by a marginal 3.8% to Rs99.5 billion as the airline re-focused on profitable routes and leased aircraft to increase the size of its fleet.

12.7.jpg


Fuel cost dropped 12.7% to Rs48 billion due to the slide in international oil price but other expenses related to managing a fleet of aged aircraft, landing charges and salary expense of a large workforce resulted in a gross loss of Rs1.9 billion.

An exchange gain of Rs3.1 billion on the back of rupee’s appreciation last year contributed in reducing operational loss.

Additionally, the high interest cost at Rs14 billion further marred the bottom-line. PIA management believes that the government would have to reschedule the airline’s long term debt.

First-quarter 2015 results

PIA also released its January to March 2015 quarter results, which showed little difference from the previous year.

Net loss during the period was Rs1.94 billion despite a gross profit of Rs5.7 billion
. The airline was even able to book an operational profit of Rs2.1 billion mainly because of a 50% decline in fuel cost.

But interest expense of Rs3.37 billion eroded that gain.

Published in The Express Tribune, May 6th, 2015
 
What the hell? I dont get how PIA is in loss when its always fully booked and fares are more expensive than any other airline. Worse i have oen house mate who came from Pakistan via PIA and told me that they did not have air conditioner on because of which many passenger felt the heat lol
 
Last edited:
Privatization is essential and 49% of PIA shares should be sold to Turkish Airlines and 51% to the small shareholders in Pakistan.
 
Privatization is essential and 49% of PIA shares should be sold to Turkish Airlines and 51% to the small shareholders in Pakistan.

Gullu Butt ji the privatisation always increases the airline cost and why does a government refrains from this is because the opposition will hit them on price rise on tickets. This is the scenario
 
Gullu Butt ji the privatisation always increases the airline cost and why does a government refrains from this is because the opposition will hit them on price rise on tickets. This is the scenario

You can live in Marxist paradise but privatization is best solution.
 
You can live in Marxist paradise but privatization is best solution.

This is not my point of view but if I am a government and I privatize then the blame of prise rise will come on my government by the opposition. This is the reason most governments take time
 
PIA is supposed to be state funded and be the top airline so it could put up competition....
Its the responsibility of the govt to use the assets to give confidence to the private sectors.

but hey
we're all lazy af
 
What the hell? I dont get how PIA is in loss when its always fully booked and fares are more expensive than any other airline. Worse i have oen house mate who came from Pakistan via PIA and told me that they did not have air conditioner on because of which many passenger felt the heat lol
The employee to aircraft ratio of PIA is one of highest in the world AS 450 employees to 01 aircraft.The same ratio is 127 per plane at Lufthansa.Thanks to rampage and unstopped politically influenced inductions of men in PIA during every regime esp Zardari's, where according to speculations almost 5000 sacked employees were restored from their date of expulsion in 96/97 with all pays and bonuses during that period.
 
What the hell? I dont get how PIA is in loss when its always fully booked and fares are more expensive than any other airline. Worse i have oen house mate who came from Pakistan via PIA and told me that they did not have air conditioner on because of which many passenger felt the heat lol
they pay more and hire 5 times more than anyone.
however one of the reasons for loss is wrong and expensive procurements that resulted in debt building up of 300 billion rupees PIA pays a heft interest on that loan and thus is in lossess.
best solution is for the govt to take the loan itself and privitze PIA by end of this year once it complete its fleet expansion.

Privatization is essential and 49% of PIA shares should be sold to Turkish Airlines and 51% to the small shareholders in Pakistan.
i think govt should simply sell 20-25% share to local player who is ready to merge with PIA . selling it to any outside player may simply destroy PIA.
real question is how to sell a loss making 300 billion rupees debt and super over employed enterprise.. i think its next to impossible
 
I think govt should simply sell 20-25% share to local player who is ready to merge with PIA . selling it to any outside player may simply destroy PIA. real question is how to sell a loss making 300 billion rupees debt and super over employed enterprise.. i think its next to impossible

PIA's international and domestic routes which serves 200 million population in Pakistan and nearly 2 million overseas is attractive to any international investor. More than half of PIA employees have to be terminated. The Turkish Airlines tried to buy PIA and it still remain the most viable option. Privately owned and restructured PIA would win back
 

Users Who Are Viewing This Thread (Total: 1, Members: 0, Guests: 1)


Back
Top Bottom