News
Garuda books $76 million net profit for 2015
February 19th 2016
Indonesian flag carrier, Garuda Indonesia, on Tuesday reported a $76 million net profit for the year ended December 31, 2015, citing low oil prices and cost cuts achieved through its Quick Wins restructuring. Read More » The previous year, the Jakarta-based carrier had posted a $370 million loss.
In 2015, Garuda’s revenues declined 3%, to $3.81 billion, as the carrier was hit with flight delays and cancellations due to volcanic activity in Bali and haze that shrouded cities on the islands of Sumatra and Kalimantan. Intense competition also drove down fares.
Fuel costs, which account for approximately 30%-40% of the company's total cost, were down by a third due to the collapse in the oil price. Garuda also reduced operating expenses by restructuring loss-making international routes to Brisbane, Taipei and Narita and introducing newer, more efficient aircraft.
The carrier is expected to make a final decision on its future long-haul fleet later this year. It has signed Letters of Intent for the A350 and the B787, but has said it would only action one of the letters.
Garuda will start domestic ATR operations from Pondok Cabe near Jakarta next month to alleviate some of the pressure at its heavily-congested Soekarno-Hatta hub.
In other Indonesia updates, Lion Air Group has signed for 348 CFM International LEAP-1As to power 174 A320neos on firm order, valued at $4.9 billion at list prices (see OVERVIEW). It also purchased five full-flight simulators from CAE for $252 million. The simulators, three for the B737 MAX, one for the A320neo and another for the ATR72-600, will be equipped with the latest CAE Tropos 6000XR visual system, offering unprecedented realism. Deliveries to the airline's training centres in Jakarta, Bangkok, and Kuala Lumpur will start from 2017.
