PIA reaches break-even in operating profit

Kashif Rafiq

Chief Minister (5k+ posts)

کراچی: پی آئی اے انتظامیہ نے دعویٰ کیاہے کہ قومی ادارے میں طویل عرصے بعد مالی خسارے پر قابوپالیاگیا ہے اور 31مارچ کو ختم ہونے والی سہ ماہی میں انتظامی اخراجات کی نسبت ریونیو میں معمولی اضافہ ہوا ہے۔

پی آئی اے کے چیف ایگزیکٹو کے مشیر ایئروائس مارشل نورعباس نے ایکسپریس ٹریبیون کو بتایاکہ ادارے کے آپریشنل اخراجات اور ریونیو برابر ہوگئے ہیں، 3سے 4 میں ادارہ نفع کمانے کے قابل ہوجائے گا۔ قومی ادارے کا ریونیوپہلی سہ ماہی میں8سے 8.5ارب روپے ماہانہ پر پہنچ گیا جو گزشتہ سال اسی عرصے میں7ارب روپے ماہانہ تھا۔

فضائی بیڑے میں4طیاروں کا اضافہ، ملازمین کی تعداد میں کمی، ٹکٹ ریزرویشن کی لاگت میں کمی، کارگو بزنس میں اضافہ اور نفع بخش روٹ پر پروازوں کی تعداد میں اضافے سے نتائج حاصل کرنے میں مدد ملی جب کہ ترکی سے جدید سافٹ ویئر حاصل کیے جانے کے بعد سے صرف ٹکٹ ریزرویشن میں ماہانہ ایک ارب روپے کی بچت ہورہی ہے۔


KARACHI:
Pakistan International Airlines (PIA) has claimed that it has come out of losses at the operational level after quite a long time as its revenues slightly exceeded the operating cost in the quarter ended March 31, 2019.

“PIA has achieved breakeven at the operational level,” Adviser to PIA CEO Air Vice Marshal Noor Abbas told The Express Tribune. “It, however, may take three to four years to report a net profit.”

The state-owned airline’s revenue surged to an average of Rs8-8.5 billion a month in the January-March 2019 quarter compared to around Rs7 billion a month in the same period of last year. “The operating cost was slightly lower than the monthly revenue or was almost equal,” he said.

The adviser said a notable improvement in financial management came after the seat occupancy rate per flight increased to around 90% in the period under review compared to less than 70% in the corresponding period of previous year.

Moreover, the addition of four planes to the operational fleet after repair, which took more than a year, reduction in the number of employees, drastic reduction in the ticket reservation cost, increased load factor of cargo and increase in the number of flights on profit-making routes helped achieve these results.

“Such improvement in operations came following the change of management in November 2018 when Air Marshal Arshad Malik took charge as CEO of the airline,” he said. “PIA is doing well under the five-year business plan, which got approval of the cabinet very recently.”

He revealed that PIA had been saving roughly Rs1 billion a month since it acquired the new ticket reservation software from Turkey-based firm Hitit in October 2018. “The new reservation software is costing half of what PIA was paying to the US-based firm Saber.”

“The saving is playing a major role in turning around the airline,” he said.

Grounded planes return to air
The adviser said seven aircraft had been grounded for repair and maintenance at the time the new management took over the airline. Some of them had remained in the hangar for over a year due to lack of finances. “We have now put four of them in the operational fleet,” Abbas said.

It became possible after the government extended sovereign guarantees for commercial loans worth Rs5.6 billion for repair and maintenance in February 2019.

“Another two grounded aircraft – Boing 777 AP-BHV and A-320 AP-BLV – will start flying by mid-May,” he said. “The required parts have arrived from original equipment manufacturers (OEMs) in the US and Europe.”

Cargo load improves
He said the cargo load factor had also increased to over 70% these days compared to less than 50% about six months ago. “Accordingly, the share of revenue from cargo operations has increased to 7-8% in the total revenue compared to around 5% earlier,” he said.

New planes
He said the management had planned to increase the fleet to around 45 aircraft under the five-year business plan from 32 at present. “First of the new aircraft is expected to be acquired in the current calendar year.”

He, however, said it had not yet been decided whether the first aircraft would be narrow or wide-body plane. However, 60% of the 13 new aircraft would be narrow-body and the remaining would be wide-body.


HR rationalisation
He said the state-owned airline had started the process of human resources rationalisation. “We need to cut human resource by 25-30%. We may do so in the next two to three months. The rationalisation drive kicked off in January,” he said.

There are around 13,000 regular employees and another 3,000 outsourced employees of PIA.

He added the impact of HR rationalisation would not be at the mass level as 500-600 employees were leaving the organisation themselves every year including around 400 who were reaching the retirement age.


Routes rationalisation
He said PIA had increased the number of flights and started flying on around eight new international routes, mostly in the Middle East, since the change in management in November 2018. “PIA is also going to start flights on the Islamabad-Muscat route on April 23. This will be the ninth new route in less than six months.”

Besides, it has stopped and suspended flights on a couple of loss-making routes under the rationalisation programme.

Published in The Express Tribune, April 20th, 2019.


 
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There is only 1

Chief Minister (5k+ posts)
سرکاری اداروں سے کچرا ملازمین نکالے جایئں ، یعنی وہ ملازم جو سفارش پر آئے ہیں اور سرکاری اداروں میں صرف حرام مال کھانے کو بیٹھے . . . . . . . یہ لوگ کوئی کام کاج نہیں کرتے ان کی تنخواہ بھی حرام مال ہوتی ہے
 

rahail

MPA (400+ posts)
Amazing. This is what should be done. Although Asad Umer was good, he was not good enough to give some relief to people as well in some way. So yea. Pakistan's finances is a monster that needs some warrior that can tame the beast.
 

zagyy

Councller (250+ posts)
This is another bulshit story. increase in revenue doesn't mean profit. revenue every year increase because of inflation, devaluation and other circumstances. main thing is a reduction in surplus expenses, overheads and administrative expenses. Income statement tells the real story not the revenue.

every govt tells the same story and finally PIA ends up in huge losses.....
 

hawkinthesky111

Minister (2k+ posts)
This is another bulshit story. increase in revenue doesn't mean profit. revenue every year increase because of inflation, devaluation and other circumstances. main thing is a reduction in surplus expenses, overheads and administrative expenses. Income statement tells the real story not the revenue.

every govt tells the same story and finally PIA ends up in huge losses.....
tension na lay zaggy…. germa CEO say behter hi hai jo kay jahazz lay ker ghaib ho gaya th aur Gunjay ko pata bh nahin lega
 

zagyy

Councller (250+ posts)
tension na lay zaggy…. germa CEO say behter hi hai jo kay jahazz lay ker ghaib ho gaya th aur Gunjay ko pata bh nahin lega
Tension kee baat nahi Boss!!. Why they give wrong Info to general Public. Let them give the Income statement instead of revenue statement. 100 Rs Ticket ke price increase karain to revenue barh jata hai.

Save my post till the end of year. Aur saal k akhir main news parh lana." PIA ko arbon ka Loss, PIA k chairmain ko Tabdeel dya gya, aur NAB ne corruption k casese khol dyey""

This is a short story of Pakistan.
 

hawkinthesky111

Minister (2k+ posts)
Tension kee baat nahi Boss!!. Why they give wrong Info to general Public. Let them give the Income statement instead of revenue statement. 100 Rs Ticket ke price increase karain to revenue barh jata hai.

Save my post till the end of year. Aur saal k akhir main news parh lana." PIA ko arbon ka Loss, PIA k chairmain ko Tabdeel dya gya, aur NAB ne corruption k casese khol dyey""

This is a short story of Pakistan.
I agree with you on this...
lets wait and see . its too early to give any comment..
but atleast it seems the direction is right and we will not see any other PIA plane going to Germany museum anytime soon..
 

back to the future

Minister (2k+ posts)
This simply means that operational revenue is equal to operational expenses
Meaning that they are no more incurring operational loss however pia will still be in overall loss due to financial expenses ie interest on loans taken by pia and that would be huge as last year
The airline will turn around and it will take atleast many years before wiping off accumulated losses
 

v r imran k

Chief Minister (5k+ posts)
It's good news if revenue increase then everything I'll be In crease with the passage of time .its doesn't means they are in profit right now but next two three year it I'll be on profit .the main thing PIA CEO interest intention to make PIA as profitable organisation
 

Sohail Shuja

Minister (2k+ posts)
This simply means that operational revenue is equal to operational expenses
Meaning that they are no more incurring operational loss however pia will still be in overall loss due to financial expenses ie interest on loans taken by pia and that would be huge as last year
The airline will turn around and it will take atleast many years before wiping off accumulated losses
Interest on loans aka Cost of Capital is already included in the liabilities and therefore included in Opex.
 

Nadir Bashir

Senator (1k+ posts)
Please give such more good news.

Would love to hear some good news from Pakistan Steel Mill, Wapda and Petroleum sectors..........
 

Nice2MU

Prime Minister (20k+ posts)
پہلے یہ کچرا ملازمین پی آئی اے کا کچومر نکالتے رہیں اب سینٹ کا کچومر نکال رہے ہیں مثلاً مشاہد اللہ

سرکاری اداروں سے کچرا ملازمین نکالے جایئں ، یعنی وہ ملازم جو سفارش پر آئے ہیں اور سرکاری اداروں میں صرف حرام مال کھانے کو بیٹھے . . . . . . . یہ لوگ کوئی کام کاج نہیں کرتے ان کی تنخواہ بھی حرام مال ہوتی ہے
 

fawad ali

Chief Minister (5k+ posts)
A big lie. After getting billions from government to get aircrafts operational, they increased total revenues for time being.
Not a single person fired from PIA for inefficiency or corruption. Same people running same airline. Sab jhoot. Nothing has changed.
 

rtabasum2

Chief Minister (5k+ posts)
A big lie. After getting billions from government to get aircrafts operational, they increased total revenues for time being.
Not a single person fired from PIA for inefficiency or corruption. Same people running same airline. Sab jhoot. Nothing has changed.
Privatize the elephant.................hope Hafeez shiekh does that .................
 

Shahid Abassi

Minister (2k+ posts)
ایک طرف ریونیو ۷ ارب سے آٹھ ارب مہینہ ہو گیا یعنی ایک ارب کا اضافہ
دوسری طرف جدید ٹکٹنگ سافٹ وئیر کے آ جانے سے ماہانہ ایک ارب بچت۔
تو پھرآپ نے اب تک کیا آپریشنل تیر مارا ہے
 

Fawad Javed

MPA (400+ posts)
15 people are hired for 1 person job and 99% are kaam chor and corrupt
سرکاری اداروں سے کچرا ملازمین نکالے جایئں ، یعنی وہ ملازم جو سفارش پر آئے ہیں اور سرکاری اداروں میں صرف حرام مال کھانے کو بیٹھے . . . . . . . یہ لوگ کوئی کام کاج نہیں کرتے ان کی تنخواہ بھی حرام مال ہوتی ہے
 
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