PIA’s financial turbulence: losses exceed Rs 60 billion in six months

ISLAMABAD: Pakistan International Airlines (PIA) has been navigating a turbulent fiscal year with notable contrasts between 2022 and 2023, as highlighted in their recently released half-yearly financial report.

Optimistically titled as “Thrusting for Progress!” the report shows that the airline’s losses exceeded Rs 60.7 billion from January to June 2023. This figure is in stark contrast to the same period in 2022 when losses were reported at Rs 41.31 billion.

However, it may be noted that in the stated losses, PIA has accounted for Rs 902 million in taxes, and Rs 1.26 billion in provisions, detailed financial statements show.

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A significant portion of the losses in the first half of 2023, amounting to Rs 27.45 billion, was attributed to the depreciation of the rupee. Comparing the exchange rate impact, exchange losses stood at Rs 13.85 billion during the same time period in the previous fiscal year.

Fuel costs have also shot up in the current year, with Rs 48.34 billion spent in the first half of 2023 on fuel and oil, compared to Rs 30.78 billion during the same period in 2022.

The cost of finance also witnessed an increase according to the yearly comparison, standing at Rs 36.82 billion in the first six months of FY23, compared to Rs 21.11 billion in FY22.

However, PIA’s revenue also grew by a notable degree. From January to June 2023, PIA managed to collect Rs 120.278 billion as compared to the same period last year when Rs 71.19 billion was collected. In terms of gross profit, PIA has shown substantial recovery, from Rs 4.3 billion loss in first half of 2022 to Rs 11.25 billion profit in first half of 2023.

On the side of the national carrier’s balance sheet, the total long term assets of PIA amount to approximately Rs 106.7 billion, and long term liabilities are more than thrice that amount at Rs 361.9 billion.