The SriLankan Airlines Group’s financial performance for the year 2007-2008 was severely affected by the steep rise in the price of aviation fuel, resulting in an operational loss of $5.45 million, according to a report in Gulf News.

 The airline spent an additional $63.31 million for fuel in 2007/08, with the fuel bill increasing by 29.26 per cent to $279.66 million from $216.35 million in the previous year. This was the result of the average price of jet fuel reaching $101.81 per barrel in 2007/08, as against $87.09 in 2006/07.

 However, the sale and leaseback of three Airbus A340 aircraft resulted in a group net profit for the year of $45.38 million. In the previous year, the group recorded a net profit of $7.88 million.

The group consists of SriLankan Airlines and its fully owned subsidiary SriLankan Catering. 

Reflecting the one off gain from the sale and lease back of the three A340 aircraft, the airline recorded a net profit of $41.01 million for the year under review, compared to $5.19 million in the previous year.

Revenue from passenger sales recorded a significant increase at $590.95 million, up from $492.57 million, an increase of 19.97 per cent.

Dr PB Jayasundera, the group’s chairman said, “The global aviation industry as a whole is in the throes of its largest ever crisis, brought about by the steep increase and uncertain direction of fuel prices, driven by a combination of price speculation in global markets, and increasing demand from the expanding economies of Asia. In the short term, SriLankan Airlines faces a challenging future, as does the entire global air transport industry, buffeted by volatile fuel prices and economic slowdown.”