A-I flies into red in first half

MUMBAI, DEC 3: The airline, which is due to be privatised by next March, posted an operating loss of Rs 28 crore in the half year from an ...

MUMBAI, DEC 3: The airline, which is due to be privatised by next March, posted an operating loss of Rs 28 crore in the half year from an operating profit of Rs 59 crore in same period a year ago. quot;If Air India did not have the fuel price crisis, it would have made an operating profit of 1.3 billion,quot; Yadav told reporters at an aviation conference.

quot;Fuel costs for the year to March 2001 will touch Rs 1050 crore,quot; Air India chairman and managing director MP Mascarenhas told Reuters. The company spent eight billion rupees on fuel in the previous financial year.

Mascarenhas said the airline was on target to achieve budgeted turnover of Rs 4650 crore for the year, but he declined to comment on profitability. Air India posted turnover of Rs 4400 crore in the year to March 2000. In the first half of the current year, Air India achieved turnover of Rs 2413 crore from Rs 2180 crore last year.

The airline8217;s net loss in the first half was Rs 5 crore, lower than last year8217;s Rs 5.71 crore, due to a rise in non-operating income from Rs 49 crore to Rs 130 crore.

The fuel bill for the first six months was Rs 461 crore, against Rs 303 crore last year. The load factor for the first six months was 73 per cent, up from 67.9 per cent in first half 1999/00.

Air India also said it had finalised agreements to acquire four Airbus 310s on a three-year dry lease, two each from Singapore Airlines and General Electric Capital Aviation Services. The aircraft are to join the fleet before April next.

A senior company official, who asked not to be identified, said Air India hoped to get permission in six weeks from the government8217;s department of public enterprise for a voluntary retirement scheme aimed at pruning its staff of 17,400.

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quot;We hope around 750 people will avail of the scheme, and that could cost us Rs 65 crore,quot; he said. Asked about Air India8217;s privatisation, Yadav told Reuters he expected the sell-off to be completed on time, by March 2001.

Yadav said that domestic state-owned carrier Indian Airlines recorded a net loss of Rs 109 crore in the period, with increase in fuel costs contributing 880 million to the bottom line. The airline posted a net profit of Rs 6.15 crore in the first half last year. Turnover for the half rose to Rs 1805 crore from Rs 1753 crore.

Yadav said the company would spend one billion rupees on expanding Bombay international airport and another programme, to enlarge the domestic airport, would begin in 2001 and cost Rs 200 crore.

He said the state-run Hotel Corporation of India, an Air India subsidiary, was renovating 244 rooms in hotels in Bombay and Delhi at a cost of Rs 16 crore.