SriLankan Airlines forges ahead with Business Turnaround Plan
View(s):SriLankan Airlines said on Thursday that it has made significant progress in its efforts to become a sophisticated customer-centric airline intent on achieving financial success, by implementing a wide-ranging Turnaround Plan under the leadership of its Board of Directors with the unstinted support of its employees across all divisions.
Following the appointment of a new Board of Directors in April 2018, the majority on an honorary unrecompensed basis, SriLankan began implementing a wide range of initiatives to curtail losses and improve the customer experience, despite many challenges including the impact on tourist arrivals from the Easter Sunday attacks, volatile fuel prices and depreciation of the rupee, the airline said in a media release.
The airline will expand its presence in the important Australian market by commencing operations to Sydney next year and further strengthen its position as the largest foreign carrier in India with the launch of services to Ahmedabad. SriLankan also intends to stretch its wings in Southeast Asia with a new service to Ho Chi Minh City (Saigon) in Vietnam, while plans to return to Frankfurt, Paris and other earlier destinations continue to be under consideration, it said.
A considerable effort is being made throughout the organisation in order to provide the most pleasant and user-friendly experience in terms of both products and services, across all customer touchpoints. These enhancements, supported by latest cutting edge technology, will focus on complementing traditional SriLankan hospitality while blending the comforts of contemporary air travel. The onboard passenger experience is being greatly enhanced, including significant changes to the content and user-friendly aspects of the inflight entertainment system; revamping of the Business Class product and service; improved ranges of meals and beverages; and plans to introduce more comfortable seating in the Business Class cabins of the narrow-body fleet including the NEO aircraft serving the Far East.
“One of the first steps that was firmly implemented by the new Board was the restructuring of the National Carrier’s Management Team, with proven experts in the aviation industry being inducted into key positions including those of Chief Executive Officer, Chief Technical Officer, Chief Financial Officer, Chief Commercial Officer, and Chief of Service Delivery. With the full support of the staff, the Management Team rolled out multiple initiatives, introducing budgetary controls for all cost lines, inculcating a cost-conscious culture and driving financial acumen across the organisation. However, great care was taken to ensure that the cost optimising did not adversely impact the product and services enjoyed by customers,” it said.
This has resulted in the financial performance for the six months ending September 30, 2019 showing an upward trend by reducing losses by more than 50 per cent, with a loss of US$19 million before interest and withholding tax against a loss of $39 million for the same period in the previous year. After interest and withholding tax, the half yearly group loss was $76 million, a $10 million improvement over the $86 million loss in the previous year.
This was achieved despite an overall decline in Group Revenue of $43 million, 70 per cent of which was due to a drop in passenger and cargo revenue. The reduction in ground handling and catering revenue also impacted the shortfall, as other airlines reduced their operations following the Easter Sunday attacks. However, in the second half of the year, Group Revenue is projected to increase significantly with the enhancement in operations by SriLankan and customer airlines.