State-owned flag carrier Garuda Indonesia has bounced back to profit in the third quarter of the year, worth US$19.6 million, after a $64 million net loss in the second quarter, thanks to an increase in domestic passengers and the stable avtur price.
Garuda Indonesia president director Muhammad Arif Wibowo said passenger numbers had increased by 9.2 percent year-on-year (yoy) to 9.5 million in the third quarter, while the fuel expense decreased by 5 percent to $259.6 million compared to the same period last year.
“Our first and second quarters were tough because we had significant route expansions and large maintenance costs in those quarters,” Arif said during a press conference in Jakarta on Monday.
However, the expansive first half was not in line with passenger growth, which lagged behind. With a 13.3 percent yoy hike in Garuda’s carrying capacity as of September, the company only saw a 6.1 percent increase in passenger numbers.
Thus, the company still recorded a $43.6 net loss in the first nine months of the year, compared to the $51.4 million net profit it booked in the same period last year.
“An expansion does not immediately lead to a revenue hike. Our load factor in the new established routes will be only 30 to 40 percent in the first three months,” Arif said.
However, he is optimistic that Garuda’s expansion strategy will be advantageous and absorb a potential passenger-number increase in the wake of potential economic growth next year. (ags)