Business

Won’t discard SriLankan restructuring plan offhand: Pathirage

Any positive proposals in the restructuring plan which was compiled by the previous Government to rescue SriLankan Airlines, the loss making national carrier, will be carried forward by its new Chairman Ashok Pathirage.
Speaking to The Sunday Morning Business, Pathirage noted that following an evaluation of the restructuring strategy, the airline would retain the areas it finds to be beneficial and constructive.
“We will not simply throw away the restructuring plan just because it was done by the previous Government. We will definitely look into it and take whatever we think is good for the airline,” Pathirage added.
Ashok Pathirage was appointed as the new Chairperson of SriLankan Airlines Ltd. on 16 December by the Ministry of Tourism and Aviation. He is also the Chairman/CEO of the diversified conglomerate Softlogic Holdings PLC.
He noted that his main aim is to look at ways of improving the profitability of the national carrier and thereby transform the perception of the airline. However, he stated that it is premature to disclose to the media any privatisation plans the new management may have for the airline.
Restructuring strategy
In May this year, an expert committee appointed by former President Maithripala Sirisena submitted its report on restructuring SriLankan Airlines to the Cabinet of Ministers and the report was approved. SriLankan Airlines is reportedly in the process of implementing the restructuring plan to save itself from financial struggles, although the progress of the implementation is not known.
The committee made recommendations with respect to the financial restructuring, corporate restructuring, preparation of an effective strategic plan and operating business model, and human resource restructuring of SriLankan Airlines, ensuring an independent procurement process and exploiting synergies in brand promotion.
SriLankan Airlines’ loss during the 10-year period from 2009 to 2019 is Rs. 240 billion. In addition to the losses incurred, the total value of loans owed by SriLankan Airlines to state banks and state institutions including the CPC is Rs. 146 billion.
According to the recently released report by the Committee on Public Enterprises (COPE), the operating loss suffered by SriLankan Airlines was Rs. 4,428 million in 2008, when Emirates withdrew from the management of the airline. A total of 14 aircraft, comprising five A320 aircraft, four A330-200 aircraft, and five A340-300 aircraft, were operated by the company at the time.