Island Aviation Services (IAS), the company which operates the national carrier, Maldivian, has reported a loss of MVR 110 million.
Statistics published by the Privatization and Corporatization Board (PCB) which oversees state-owned companies show that the income for ISA fell by 76 percent in the second quarter of 2020 when compared with the second quarter of 2019.
The company earned MVR 457 million in the second quarter of last year while it earned just MVR 109 million in the second quarter of 2020.
IAS faced a loss of MVR 12.5 million last year. This year, the losses increased to MVR 110 million which is a loss of 780 percent.
The PCB report for the company stated that COVID-19 and its implications on businesses and the economy led to a halt in the company operations. The company’s income also fell by MVR 257 million due to shortages in passenger incomes of the interrupted seaplane operations.
Statistics show that while the company faced a loss of MVR 12.5 million in 2019, the company was faced with a loss of MVR 24.2 million in the first quarter of 2020, while in the second quarter, it faced a loss of MVR 129.5 million.
Some of the expenses of the company were also saved due to the closure of its offices in light of the COVID-19 lockdown. Operation costs fell by MVR 45 million while wages and remunerations also fell by MVR 20.9 million.
The biggest concern outlined in the PCB report was that the company’s hard assets value was lower than its short-term debt. The report also noted that the company did not have a cash flow to repay the short-term debts of the company.
The projected future for the company was bleak, noted the report. The PCB advised IAS to cut down costs and increase its earnings and income after taking into account the huge number of overdrafts obtained by the company from banks to cover losses. Enhancing the work of the credit control department of the company and recovering money owed to the company was also recommended by the PCB in its report.