Q: Could you provide an overall picture of SriLankan Airlines as it stands today?

Ashok Pathirage (AP): SriLankan Airlines made a remarkable turnaround and recorded an unaudited net profit of US$ 3 million for the financial year ending 31 March 2023 despite many challenges including the economic crisis.

We achieved this feat by taking out costs during COVID-19, micromanaging the allocation of resources and increasing yields as we returned to meaningful flying. This turnaround was achieved without any external funding over the last two years. We hope to maintain this momentum in the current year and further improve our profitability.

Q: What is SriLankan’s service philosophy?

AP: SriLankan Airlines is committed to delivering excellent service with a strong emphasis on customer satisfaction. Ensuring the comfort and wellbeing of our passengers is a top priority, and SriLankan Airlines is renowned for its warm and friendly service on board flights.

We strive to create memorable travel experiences by also paying attention to detail and personalising our service based on customers’ preferences.

Q: In your view, what is the major operational limitation for SriLankan Airlines – and how does the management overcome this?

AP: SriLankan Airlines has to contend with several challenges and one of the most pressing issues right now is our reduced fleet, which limits our ability to expand operations in line with demand. This issue however, will be resolved with the anticipated replacement aircraft deliveries to our fleet.

We are also suffering from high staff turnover, which is common to many local businesses at the moment, and we’re devising a retention strategy that will be implemented in the months ahead.

Q: Could you outline the organisation’s contribution to Sri Lanka’s tourism industry and economy?

AP: SriLankan Airlines is a major foreign currency earner, bringing close to a billion dollars annually. The airline also plays a key role in connecting trade flows and tourists to and from Sri Lanka.

SriLankan Airlines accounts for nearly 60 percent of the overall airline seat share between top inbound tourist markets and Sri Lanka, and is the island’s largest facilitator of air cargo exports and imports.

Q: What are the greatest strengths of SriLankan Airlines?

AP: Our greatest strength is our people, who have made the impossible possible. SriLankan Airlines also draws strength from its reputation for inflight service and hospitality.

The airline also makes good use of the geographical positioning of its home base ‘hub’ that affords easy connections to unserved and underserved markets in the Indian subcontinent, the Far East and Africa – an advantage that SriLankan is happy to pass on to its customers.

Q: So what future plans are in store for SriLankan Airlines?

AP: We want to maintain and improve upon the strong results that we attained between 2022 and 2023 by restoring our operations and fleet in the short term. We are hopeful about reestablishing our operating fleet to 27 aircraft, thereby increasing capacity to pre-pandemic levels for a robust network in the mid-term.

SriLankan Airlines’ plans for the long run include building a network that is optimised for promoting tourism to Sri Lanka in support of national tourism development goals.

Q: Could you shed light on the organisation’s long-term network strategy?

Richard Nuttall (RN): Restoring the fleet to its pre-COVID state is our primary priority. Currently, we comprise 23 aircraft, four of which are on ground pending engine overhauls. This is due to a global issue with engines for A320neo aircraft whereby there is not enough global capacity to meet engine overhaul demand. We hope to have this resolved by early next year.

Before the pandemic, we had 27 aircraft. We are currently working to lease additional aircraft to return to this number by mid-2024.

As we expand our fleet, the priority will be to increase capacity and frequency to our current destinations. Thereafter, we will look to add new destinations in India, the Indian Ocean and East Africa in the longer term.

Q: What are the long-term fleet strategy and plans for the anticipated replacement aircraft deliveries?

RN: We currently have an understanding with the government to return to our pre-COVID fleet number of 27. Ideally, the airline should grow to about 35 aircraft over the coming three or four years in line with the expected demand growth and considering that we had 27 aircraft in 2019. We lease all our aircraft now but these leases will largely end between 2028 and 2030, at which point we will run an exercise to re-fleet with new aircraft if our situation is stable.

Q: How is your organisation utilising digital technologies to provide better passenger service?

RN: Today’s passengers are looking to do a whole lot more through their phones and spend less time on calls or standing in queues. In keeping with this, SriLankan Airlines recently launched a new mobile booking app.

We will be looking to gradually add more features to make it easier for passengers to manage their travel including check-in and management of FlySmiLes accounts over the coming months. We’re also looking to speed up the airport experience with mobile check-ins, and the use of kiosks to self-handle at the airport and reduce the need to use check-in counters.

And we are currently going through a programme of replacing and updating the company’s core airline systems including the revenue management systems, engineering systems, cargo systems and revenue accounting systems.

Q: What are SriLankan Airlines’ plans for a sustainable future?

RN: The aviation industry wants to be carbon neutral by 2050. That is our goal as well. We are already working on some initiatives such as flying more efficient routings.

However, to reach this overall goal, we will require global collaboration with airlines and suppliers to find technological solutions.

Going carbon neutral covers multiple areas from more efficient air traffic control – which is possible today – to more efficient engines, the development of sustainable aviation fuel (SAF) in sufficient quantities at affordable prices, and the use of other power sources such as electricity and liquid hydrogen. As an airline in a country that is green with a low carbon footprint and high biodiversity, we also want to set an example and support other sustainability initiatives. We also participate in various other conservation projects.

This includes planting of mangroves, supporting the scientific study and preservation of seagrass meadows that retain 35 times more carbon than terrestrial forests, and our own signature upcycle programme ‘Mathaka,’ which makes use of waste material such as aircraft seat covers to make designer stationery and bags.

Q: In your assessment, what is SriLankan Airlines’ potential for growth?

RN: I have worked for eight airlines. With its geographic location and natural traffic flows, SriLankan Airlines tops the list in terms of capacity to deliver profitable and sustainable growth, both for the airline and Sri Lanka, if the country goes through a period of stability.

The airline is uniquely positioned to support tourism to the country, carry the large Sri Lankan diaspora and take advantage of being next door to the most populous country in the world. We are a natural hub for air freight. Sri Lanka is also comparatively culturally closer to India, and this along with the natural hospitality of its people, makes the country a favourite for many passengers from India.

But the biggest difficulty we face right now is the state of the nation.

Given the economic challenges, current interest rates in Sri Lanka are unsustainable for a low margin industry. No airline in the world could sustain our current finance costs over a long period of time.

However, if we can restructure our debts, we will be able to play a bigger role in supporting the country in its current recovery programme. What’s more, in an industry that always has its ups and downs, given low margins and susceptibility to geopolitical events, SriLankan has developed a strong resilience that pays off in a very competitive industry.

– Compiled by Dona Senara

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Telephone - 019 7331979 | Email - reservations@srilankan.com | Website - www.srilankan.com