Sri Lankan Airlines posts negative net worth
COLOMBO, Nov. 20, Kyodo - SriLankan Airlines total liabilities exceeded total assets in the year ended March 31, 2001, and its auditors have cast doubts ''the company will be able to continue as a going concern,'' the beleaguered airline's annual report revealed Tuesday.
SriLankan incurred its biggest-ever loss, 6.5 billion rupees (about $70.7 million), during the year, with current liabilities exceeding current assets by 4.4 billion rupees and total liabilities ahead of total assets by 3.7 billion rupees.
In July this year, the airline suffered a crippling blow when a terrorist attack on the Colombo International Airport saw the company lose half its fleet -- three Airbus aircraft destroyed and three more damaged.
SriLankan, which is owned 43.6% by Emirates of Dubai and managed by Emirates, said the airport losses will be fully borne by the insurers, but it will not be replacing the aircraft destroyed in the attack.
''We have already taken a number of key decisions: to reduce our route network; not replaced the aircraft lost in the July 24 attack; introduced voluntary severance schemes to reduce staff numbers; a complete freeze on all staff recruitment; and a major cost reduction program,'' Managing Director Tim Clark said.
The Sri Lankan government owns the airline's controlling equity.
[ 22 November 2001: Message edited by: L1011 ]