PIA Posts Net Profit For the First Time in Over 2 Decades

Pakistan International Airlines (PIA) has posted a net profit for the first time since 2003, compared to losses of Rs. 104.5 billion last year. The airline’s board of directors has approved the financial results for 2024, according to Bloomberg. The airline achieved earnings per share of Rs. 5.01 in the year ended December, translating into an operational profit of Rs. 3.9 billion and a net profit of Rs. 2.26 billion during the period. The airline also achieved an operating margin exceeding 12 percent. The national flag carrier, once burdened by heavy debt and operational inefficiencies, has undergone significant reforms. These included a near 30 percent reduction in workforce, cost control measures, streamlining of profitable routes, and closure of consistently loss-making sectors. Restructuring of its balance sheet is one of the main reasons why PIA has posted a profit this time. PIA in recent years had faced grounded aircraft abroad, cancelled flights, and fears of default. A previous privatization effort in 2024 failed after initial bids came in below the $306 million benchmark. The government is now preparing for a second round, with new bids expected later this month. To make the airline more attractive to buy, authorities have transferred the majority of PIA’s Rs. 660 billion debt off the airline’s books to a separate government-owned holding company. Companies that showed interest earlier have re-engaged, while operational losses have eased following an 87 percent drop in finance costs to Rs. 10.1 billion, though revenue declined by 14 percent to Rs. 204 billion. Over the past three years, PIA has also reduced its workforce by 30 percent. Earlier efforts to improve operational efficiency were consistently undermined by high debt servicing costs. With those liabilities now shifted, the government hopes investor confidence will return.