Garuda Indonesia posted an operating profit of $616,000 in the first quarter of 2020, a sharp fall from the $49.4 million profit in the same period last year.

Revenue for the quarter ended 31 March fell by 30.1% year-on-year to $768 million, led by a 29.2% decline in revenues from scheduled passenger services to nearly $655 million.

The carrier’s expenses declined 9.9% to nearly $946 million, due to a reduction in costs associated with flying operations, airports, as well as passenger services. On the other hand, administrative and aircraft maintenance costs increased.

Despite the operating profit, the airline recorded a net loss of $120 million due to significantly higher finance costs, compared to a $20.5 million net profit in the first quarter of 2019.

As of 31 March, Garuda had $163 million in cash and cash equivalents, down from $337 million a year before.

The SkyTeam alliance member says it is exploring options to overcome challenges caused by the Covid-19 pandemic. These include rightsizing capacity, offering discounts on selected routes, optimising cargo and charter services, renegotiating with its vendors to reduce cost and obtain payment delays, and early termination of aircraft leases.

It will also work in “close coordination” with the Indonesian government, particularly on any potential evaluation to the price floor and price ceiling on air tickets, following the government’s decision on 8 June to impose a 70% capacity limit on all aircraft in a bid to contain the spread of Covid-19.