LAHORE- Pakistan International Airlines (PIA) has achieved its first net profit in more than two decades, marking a significant financial turnaround for the national carrier.
Defence Minister Khawaja Asif announced the airline earned a net profit of Rs 26.2 billion in the fiscal year 2024, positioning it for potential privatization. The last time PIA recorded a profit was 21 years earlier, in 2003.
Photo: Aero Icarus | FlickrPakistan Airlines Records Profit
The national flag carrier posted an operating profit of Rs 9.3 billion in the fiscal year 2024, achieving an operating margin exceeding 12%. This performance puts PIA on par with some leading global airlines.
“This is a significant achievement, marking a real turnaround for the airline.”
Khawaja Asif, Defence Minister, Pakistan
The defense minister explained that PIA implemented comprehensive reforms to achieve this financial recovery. These reforms included cost-control measures, workforce rationalization, route optimization, and financial discipline.
PIA’s Board of Directors has approved the airline’s 2024 annual results. According to Bloomberg, citing audit documents, the airline achieved earnings per share of 5.01 rupees for the year that ended in December.
Asif emphasized that PIA is now positioned to capitalize on its improved financial performance through privatization.
“The airline is now prepared to benefit from its financial recovery through privatization,” he said.
Pakistan’s previous attempts to sell the financially-strained airline faced setbacks when the sole bid received fell below the $306 million minimum price. Reports indicate another privatization push is underway, with initial bids due this month.
To make the deal more attractive, approximately three-quarters of the airline’s debt has been removed from government books.
This time around, all the debt has been canceled, and the former bidders have welcomed it with renewed interest.”
Usman Bajwa, Secretary at the Privatisation Commission
Photo- Wikimedia Commons; Compiled By Aviation A2ZPIA’s Ongoing Challenges
Despite the recent profit, PIA has faced numerous challenges in previous years. The airline experienced severe financial turbulence, with heavy losses that pushed it to the verge of default.
The situation became so dire that PIA planes were seized abroad and flights canceled.
The carrier has survived only through regular government bailouts, which have now ceased. Massive debt servicing amid mounting losses previously negated any operational improvements.
Photo- Gyrostat; Wikimedia CommonsMarket Position and Competition
PIA currently holds 23% of Pakistan’s domestic aviation market but struggles to compete internationally. Its 34-plane fleet cannot match Middle Eastern carriers, which control 60% of Pakistan’s international traffic.
Despite having agreements with 87 countries and key landing slots, PIA lacks sufficient direct flights to capitalize on these advantages.
For the past three years, PIA has pursued operational profitability through reforms, including an approximately 30% workforce reduction, the termination of unprofitable routes, and better fleet utilization. These efforts have finally yielded results with the reported profit, potentially changing the airline’s trajectory after decades of financial struggles.
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The post Pakistan Airlines Records Profit After 21 Years, Seek Privatization Plans appeared first on Aviation A2Z.
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