Pakistan International Airlines (PIA) has narrowed its attributable net loss for the first six months of 2013 to Pakistan rupees (PRs) 17.3 billion ($163 million), from a net loss of PRs17.5 billion a year earlier.
Revenue for the period ended 30 June declined 9.4% to PRs54 billion, while posting a gross profit of PRs950 million, the carrier said in its annual report.
It also narrowed its pre-tax losses to PRs16.8 billion, despite an increase in financing costs.
For the second quarter of 2013, however, PIA posted a larger attributable net loss of PRs9.77 billion. Revenue also declined 15% to PRs26.4 billion, down from PRs 30.9 billion.
PIA’s chairman Muhammad Ali Gardezi noted that a shortage of aircraft resulting in reduced capacity, a sharp depreciation of the Pakistani rupee, declining yields, higher airport charges and increased operational costs have led to significant losses. Finance charges also increased as the carrier had to borrow heavily in order to meet its working capital requirements.
The carrier’s revival strategy will be based on fleet modernisation, route enhancements through rationalisation, and other cost cutting measures.
Despite its poor financial condition, Gardezi adds the Pakistani government will continue to support the airline through measures such as an extension of its sovereign guarantees and cash injections.