PIA returns to profit after 21 years as privatisation looms

By Staff Reporter

ISLAMABAD: Pakistan International Airlines (PIA) on Tuesday reported its first annual net profit in 21 years, a milestone that could boost government efforts to privatise the debt-stricken carrier after years of losses and operational crises.

The airline reported an operational profit of Rs3.9 billion and a net profit of Rs2.26 billion for FY2024, with an operating margin exceeding 12 percent, a spokesperson said.

This dramatic turnaround, the spokesperson noted, aligns with “the best airlines in the world” and ends a profit drought dating back to 2003.

The result follows sweeping reforms, including workforce reductions, cost-cutting, shuttering unprofitable routes, and stabilising lucrative ones.

“The airline’s manpower and expenditures were considerably reduced, while measures such as ensuring stability in profitable routes, shutting down loss-making routes, and restructuring its balance sheet were taken,” the spokesperson added.

The results contrast sharply with recent turmoil that saw aircraft impounded, flights grounded, and the carrier teetering near default. Years of losses had saddled PIA with unsustainable debt, which the analysts said eroded operational gains.

Defence Minister Khawaja Asif, who oversees the aviation ministry, called the results a boost for privatisation plans. “The process of the airline’s privatisation would benefit from this development,” he wrote on social media platform X.

The government, which failed to sell PIA in 2024 after bids fell short of its $306 million minimum price, has revived the process with initial bids due this month. To attract buyers, officials shifted 75 percent of PIA’s debt—worth hundreds of billions of rupees—to government accounts and cleared residual liabilities.

“All debt has now been removed, and previous bidders have shown renewed interest,” Privatisation Secretary Usman Bajwa told Bloomberg in February.

PIA, once a symbol of national pride, has faced decades of mismanagement, political interference, and financial hemorrhaging. A 2020 fake pilot license scandal led to a European Union flight ban, further denting revenues. The IMF has repeatedly urged Pakistan to privatize loss-making state enterprises, including PIA, as part of fiscal reforms.