SriLankan Airlines bounces back

The airline is benefiting from a revival of the tourism industry

SriLankan Airlines has swung back into the black after making steep losses last year, in a sign that it has recovered from a Tamil rebel attack in 2001 which destroyed half its fleet.

The company said after-tax profits for the year to March 2003 came in at 2.1bn rupees ($21.6m), up from a loss of 3.1bn rupees before one-off income one year earlier.

The airline said its improved performance reflected the February 2002 ceasefire agreement between the Sri Lankan government and separatist Tamil rebels, which brought a bloody 20-year civil war to an end.

"It was undoubtedly due to the prevailing climate of peace," the carrier's chairman Daya Pelpola said.

The peace appears to be holding, encouraging tourists to return to the country. Visitor numbers are expected to rise nearly 15% to a record 450,000 this year.

Expansion

Mr Pelpola said passenger traffic on SriLankan Airlines rose 12% last year, while the proportion of filled seats picked up to 76% from 68% the previous year.

Hill says stage is now clear for competitors

The airline said it had added two Airbus A320s since the airport attack, allowing it to resume flights to Frankfurt and to start servicing Bangalore, Bodh Gaya and Cochin in India.

The company is also planning to buy two more aircraft which will enable it to increase its flights to Europe and Asia, Mr Pelpola added.

SriLankan Airlines' chief executive Peter Hill said the government has recently renegotiated an agreement which gave Dubai's Emirates airline a 40% stake in the company, and management control for 10 years from 1998.

He said the new arrangement would allow for other airline companies to form in the country, although the island of 19 million people is thought unlikely to attract a second player.