April 07, 2021 (MLN): Pakistan International Airline Company Limited (PIA)’s net losses for CY20 have shrunk by 34% YoY to Rs 35.3 billion as compared to the losses of Rs 52.6 billion that the company incurred in the previous year.
This translated into a loss per share of the company which reduced to Rs3.31 per share for A class ordinary shares of Rs 10 each and Rs 6.62 per share for B class ordinary shares of Rs 5 each.
During the year, PIA’s net revenues plunged by around 58% YoY, however, it managed to lessen its losses mainly on the back of multiple initiatives that helped the company reduce its operating cost.
Despite a 58% YoY and 20.6% YoY drop in PIA’s aircraft fuel cost and other costs respectively, the gross profits of the company went down by 67.2% YoY on account of lower revenues. As a result, the gross margin dipped to 3% from 5% in CY19.
As per the financial statement issued by PIA, its distribution and administrative cost during CY20 stood at Rs 4.7 billion and Rs 5.7 billion respectively. This was 23.8% and 17.8% lower than the figure reported in 2019.
In addition, around 57.68% deterioration in exchange losses and 5.3x increase in other income have also been observed which also helped PIA to reduce annual losses.
On the financial cost front, the company reported a 16.36% decline in financial charges can be attributed to the series of rate cuts during the year.
Despite facing enormous challenges and financial deterrents, the income statement of PIA has shown notable improvement. In a recent development, the Aviation Division has proposed a restructuring plan for PIA, which ECC is expected to consider and approve in today’s meeting which will support the national flag carrier improved its performance.
Unconsolidated Profit and Loss Account for the year ended December 31, 2020 ('000 Rupees)
Revenue – net
Cost of services
Other provisions and adjustments
Exchange loss – net
Loss from operations
Loss before taxation
Loss for the year
Loss per share – Basic and diluted
Loss per share – A class ordinary shares of Rs. 10 each
Loss per share- B class ordinary shares of Rs. 5 each