When I worked for Airlines Of Tasmania in 1988, they survived because they had purchased the Herons at some bargain price from Northern Airlines in the early 80's. During that era Island population was a lot bigger, as the scheelite mine was still a going concern.
After I moved on in 1989 Airlines of Tas, replaced the Herons with the Shorts 360, which was the supposed to be the best option for them, but the costs of operating that and the downturn on the island mine closure sent them broke.