Island Aviation Cuts Losses, Eyes Turnaround

Island Aviation Services Limited (IASL), which operates Maldivian, the national airline of the Maldives, reported a net loss of MVR 2.8 million for the year ending 31 December 2024—a significant reduction compared to previous years.

Despite earning MVR 2.27 billion in revenue, the company’s accumulated losses stand at MVR 1.79 billion, with current liabilities exceeding current assets by MVR 1.66 billion. Auditors have warned of a material uncertainty that raises doubts about the airline’s ability to continue as a going concern.

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Revenue Growth and Operational Challenges

The majority of IASL’s income in 2024—MVR 1.63 billion, or 75% of total revenue—came from regional and domestic passenger services. However, rising operational cost and  high aircraft maintenance expenses have weighed on profitability.

Signs of Recovery After Covid Losses

IASL’s financial difficulties began during the COVID-19 pandemic in 2020, ending a profitable streak dating back to 2014. The airline has worked hard to reduce losses, and 2024 figures show notable improvement compared to the MVR 71.4 million loss recorded last year.

The company posted a net profit of MVR 10.7 million in Q1 2023, its first profitable quarter since 2018, though seasonal dips later that year pushed the company back into a loss.

Expansion and Modernization Plans

To break the cycle of losses, IASL is implementing initiatives to expand operations and enhance customer service. Plans include:

• Introducing a wide-body aircraft in 2025 to launch new international routes.
• Replacing older Dash 8 aircraft with newer ATR models for domestic flights to reduce maintenance costs.

Outlook

With revenue growth and operational improvements, IASL aims to continue cutting losses and return to sustained profitability. However, auditors stress the company must resolve its liquidity challenges to secure a stable future.