Air India likely to register cash positive this financial year
Loss-making Air India may now see light at the end of a long tunnel as it is likely to register cash positive this financial year even though it would continue to make an overall loss, official sources said today.
"The national carrier might report EBITDA positive performance in 2012-13 as its financial performance has shown considerable improvement due to the implementation of the Turnaround and Financial Restructuring Plans," one of the sources said.
However, in its overall performance, the airline would show losses, the sources said, adding that though Air India was still suffering losses, its performance has improved and it has returned some of the loans taken from banks.
EBIDTA (earnings before interest, taxes, depreciation and amortisation) is an approximate measure of a company's operating cash flow.
Air India has been suffering losses of Rs 5,548.26 crore in 2008-09, Rs 5,552.44 crore in 2009-10, Rs 6,865.17 crore in 2010-11 and Rs 7,853 crore in 2011-12.
The prime reasons for these losses are hike in jet fuel prices, its opaque pricing and VAT on it, increase in depreciation provision due to aircraft acquisition, high infrastructure cost, fall in premium traffic and a decline in ground handling revenue, the sources said.
Air India's revenue also posted an increase of 6.5 per cent during April-September this year at Rs 4,757 crore, as against Rs 4,467 crore in the same period a year ago despite the 58-day long strike by its pilots.
For the first time since its 2007 merger, the airline made a cash surplus of Rs 48 crore
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