SriLankan Airlines Group nearly doubled its profit in the financial year 2005/06 on the strength of new market strategies and greater emphasis on controlling costs, in the face of volatile global fuel prices and increased competition.
The Group reported a Net Profit After Tax of approx $19.6m, an increase of 48.33% from the previous year’s figure.
“This was yet another challenging year for the Group. While we are still recovering from the devastating effects of the Tsunami, we faced new challenges such as the drastic rise of jet fuel prices and the deteriorating security situation in the country which significantly affected our business,” said D.H.S. Jayawardena, Chairman of SriLankan Airlines Group.
The Government of Sri Lanka owns 51.05% of the Group’s shareholding, with Emirates having 43.63%, and others including employees own 5.32%.
SriLankan Airlines Limited achieved an impressive Profit after Tax of an estimated $7.7m, a growth of 10,317% over the previous year.
“Achieving these results after the devastating effects of the Tsunami, deteriorated security situation in the country and skyrocketing global fuel prices is a significant achievement, clearly signifying the commitment and the capabilities of our staff,” said Tim Clark, the Group’s Managing Director.
The Group’s won several more international awards for the year including the Travel Trade Gazette Award for Best Airline in South Asia; the Skytrax Award for Best Cabin Staff in Central Asia; and three Freddie Awards for Skywards (the frequent flyer programme of Skywards and Emirates) including Programme of the Year.
“I am pleased to say that our staff once again proved their mettle, and carried the airline through another difficult year. The focus on better control of costs did not in any way compromise our commitment to providing the finest service,” said Peter Hill, CEO of SriLankan Airlines.
The Group’s Operating Revenue was around $601m, up 14.20% from the previous year, and the Airline’s Operating Revenue was approx $588m, up 13.66%.
The airline launched services to Beijing and increased frequencies to many existing destinations such as Kuala Lumpur, Singapore, Bangkok, Dubai, Kuwait, Riyadh, and Indian cities.
SriLankan Catering once more achieved a record setting performance, with a growth in revenue of 40%. More than 4 million meals were produced during the year, at a record average of 11,020 per day.
The Group intends to continue expanding cautiously in the year ahead while consolidating in its present markets, with the launch of services to Goa (its 50th destination), the commissioning of SriLankan Catering’s new Flight Kitchen, and the expected growth of the Cargo Centre in Katunayake.
SriLankan Airlines was created in April 1998 when Air Lanka, was privatised following the establishment of a strategic partnership with Dubai-based Emirates Airline. The agreement saw Emirates take a 40 per cent shareholding in the company and undertake a 10-year management agreement, during which time SriLankan has been established as southern Asia’s preferred international carrier.
Following its transformation, SriLankan has won a string of international aviation awards including Best Airline in Central Asia from UK’s Skytrax Research for four years in a row, (2001, 2002, 2003 and 2004), underlining its new reputation as a world-class carrier.
In 2003, SriLankan was voted as having the friendliest cabin crew by Skytrax, and also won the award for Best In-flight Entertainment (for a fleet size of 20 or less) at the annual World Airline Entertainment Association’s Avion awards in the USA.
Meanwhile, the airline’s sky taxi service has revolutionised domestic air travel in Sri Lanka, offering transfers between the airport and Colombo and Kandy, Koggala, Bentota, Trincomalee, Anuradhapura and Hingurakgoda – flight times from Bandaranaika International Airport are just 30 minutes to each town except for Trincomalee, which is a 45-minute transfer. The network incorporates most major tourist sites, from the beach resorts on the west coast around Bentota and Galle (Koggala), as well as Polonnaruwa (Hingurakgoda), Anuradhapura, Kandy and Trincomalee.
