The restructuring process of Sri Lanka’s national carrier is ongoing at the moment, CEO of SriLankan Airlines Suren Ratwatte said.  He stated that they have submitted a plan to the government and are awaiting approval. 

“This is peak time. July-August is the busiest time in the airline world as you know. Not a good time to disrupt anything,” he said, in an interview with Bloomberg.

He said that the privatisation plans are in the hands of the government who is the majority shareholder and that is being pursued by a council of ministers. The airline itself is not actually involved in that, he said. 

Ratwatte said that the restructuring will not be drastic and that the fleet rationalization has pretty much happened already. “We might lose one or two more aircraft and there are people interested in taking them.”

Speaking on ‘Bloomberg Markets: Asia’, the chief executive officer said that the airline has pulled out of most of Europe but it is still expanding its operations to India and Australia. 

“The roots have shrunk as you know. We have pulled out of most of Europe. London is the only one left. We are still expanding quite significantly to India and also Australia.”

He said that starting from October 29th the airline will launch nonstop services to Melbourne, which he thinks will be a huge boost for the traffic between Australia and Sri Lanka which has been growing year on year quite strongly.  

“So it’s not all doom and gloom. There’s still hope out there.” Ratwatte said that the airline is just trying to rejig the business and pivot to a more regional-focused network rather than the more ambitious European trade that they were in for so long. 

When asked as to how close SriLankan Airlines is to finding a partner, he said that there have been a few overtures and that the government is currently talking to some possible partners. “It’s a bit of a fine balance between finding one with the capital and one who is not a competitor. It’s not the easiest of tasks.” 

He also said that the airline is giving back three of its older narrow bodies in 2018 and will be introducing three replacement 320 neos.  “One is due for delivery this week and there’s two more due towards the end of this year. So those numbers are safe for now.” 

He said that expansion is on the cards. “I need more aircraft. Unfortunately capital is a problem. The government is obviously not in a position to pump capital into the airline.” 

With regard to the partnership search, he said that it is in the hands of the government – the primary shareholder and that his job is to run the company day-to-day.  

“There has been talk of involvement of Japanese carriers but I believe the initial push came from a group of Sri Lankan investors.” 

Asked whether it has taken longer than anticipated, Ratwatte conceded that the government does tend to move slowly and that this is a fast moving business. 

“If you don’t act quickly, I would say in the next 6 months we need to get this thing sorted. We’re going to be left behind as more and more capacity is added to the market and we lose market share.”  

He added that the last couple of months have been very good for the carrier as they have beaten their revenue forecast every month of the financial year. “So things are turning around,” he said.

“A biggest problem is the cost base. If we can reduce that we’ll be profitable this year.”