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Air India is likely to report an operating profit of Rs 1,040 crore in 2013-14, Minister for Civil Aviation Ajit Singh said on Tuesday.
“Air India’s total revenues were expected to rise 20 per cent to Rs 19,393 crore during FY13-14 from Rs 16,130 crore previously while the net losses were likely to come down to Rs 3,989 crore from Rs 5,198 crore,” the Minister said at a press conference here.
The better financial performance in 2013-14 is being attributed to a variety of factors including the airline hiving off two subsidiary companies – Air India Engineering Services and Air India Transport Services –which have already started contracting business from other airlines rather than doing only in-house business.
The airline has also started monetising its assets and has identified five unutilised properties, including vacant land in Chennai, four vacant flats in Mumbai and a vacant plot and two vacant apartments in Kolkata which will be disposed of.
Commenting on the financial performance during fiscal 2012-13, the Minister said staff costs came down by Rs 243 crore due to rationalisation of pay structure, while the airline was able to save Rs 168 crore on interest on loans and working capital due to implementation of the financial restructuring plan.
Besides, the airline entered into fresh contracts with oil companies that provide a benefit of Rs 500 crore annually. The airline carried 14.05 million passengers, an increase of almost five per cent over the previous year.
The airline Chairman and Managing Director, Rohit Nandan, said till the last fiscal almost 70 per cent of the airline capacity was making cash losses with some not even covering the cost of the fuel.
The airline operates between 470-480 daily flights.
Read also: >Air India to restart Boeing 787 services from tomorrow
> ashwini.phadnis@thehindu.co.in
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