Air India makes cash surplus, hopes for a turnaround

Air India Wednesday reported a cash surplus of Rs.48 crore during April-July 2012, reducing the net losses of the financially-stressed airline.

The national carrier had a cash deficit of Rs.586 crore during the corresponding period in the previous fiscal.

“For the first time since merger in 2007, Air India has made a cash surplus of Rs.48 crore during April-July, 2012,” Civil Aviation Minister Ajit Singh said on the sidelines of the induction of the first Boeing 787 Dreamliner aircraft into the carrier's fleet.

“The net losses of Air India during the period April-July 2012 have been reduced by Rs.557 crore,” Singh said.

According to the minister, the airline's expenditure was reduced by 4.4 percent in the period under review which stood at Rs.268 crore from like period of 2011.

He said despite a recent pilots strike that had caused a 17 percent reduction in capacity, Air India has posted an increase of 6.5 percent in revenue for the period of April-August 2012.

“The revenue on the domestic network increased by 33 percent during the period April to August, 2012 representing an increase of Rs.531 crore.”

Singh further said that Rs.2,900 crore had been given to the airline under the Rs.4,000 crore budgetary allocation made for 2012-13.

“The rest of the amount will also be injected soon. We are also going to issue non- convertible debentures worth around Rs.7,000 crore in a few weeks' time.”

The improved performance should come as a relief to the beleaguered airline which has a debt of about Rs.21,200 crore as working capital loans, Rs.22,000 crore as long-term loans on fleet acquisition and an accumulated loss of Rs.20,320 crore since 2007.

On the issue of reinstatement of 97 sacked pilots who participated in the recent strike which crippled the airline's international operations, Singh said a committee formed in July to look into the matter has recommended taking back 50 pilots.

“Out of remaining 97 pilots whose services were terminated, 50 pilots have been recommended for reinstatement, five pilots have not been found suitable for reinstatement and case of remaining 42 pilots is still under consideration,” the minister said.