Garuda Indonesia posts a net loss of $373 million in 2014

[Mr.Bandit 0]

JAKARTA -- National flag-carrier Garuda Indonesia has posted a net loss of over $373 million for 2014, a significant negative turnaround from the net profit of nearly $10.8 million it reported in 2013.

The slide was attributed to more intense regional competition, higher fuel costs and the weakness of the rupiah.

Garuda saw year-on-year revenue growth of only 4.6% to $3.93 billion in 2014, while operational costs jumped 14.6% to $4.29 billion.

Garuda is considering a raft of measures to tackle the crisis, including searching for new revenue streams, cost restructuring and debt reconfiguration.

On its route network, Garuda is considering new routes to China and the Middle East. In China, it has been looking at Chengdu, Chongqing and Ningbo, and at services emanating from Denpasar and Manado.

Chief Executive Arif Wibowo confirmed that Garuda is exploring new possibilities in Asia and the Middle East, including the growing Umrah market for non-Haj pilgrimages to Mecca at other times of the year.

Adjustments are also expected on existing services to Australia and Japan, as well as delays on new routes previously announced.

Ari Askhara Danadiputra, Garuda's director of finance and risk management, said that with the weakening rupiah and volatile fuel prices the airline will review its currency and fuel hedging options. Half of 2015's fuel will be hedged compared to only 10% in 2014, he said.

 

source : http://asia.nikkei.com/Business/AC/Flag-carrier-plunges-into-the-red

 

[J. Suri 0]

It is always a price to be paid for the status as 5 Star Airlines...