Garuda Indonesia will focus on its domestic operations – and be “selective” on international expansion – as it continues to grow its fleet this year.
Outlining its strategy to “capture three quick wins”, the Jakarta-based carrier says it aims to simplify its operations by focusing on the domestic network, and will “strengthen network synergy” with low-cost unit Citilink.
The aim is to “continue to increase the group’s competitive advantage in terms of connectivity, utilisation and route profitability”.
Garuda will add nine aircraft this year, including one unspecified aircraft it had deferred from 2023.
The additional capacity will allow it to “optimise” network expansion. The airline will launch direct flights to Doha – as part of a partnership with Qatar Airways – from 4 April, its newest international destination since the Covid-19 pandemic.
The airline has made profitability a key priority in the near-term. For the year ended 31 December 2023, it posted a net profit of $250 million, a significant reduction from 2022’s $3.7 billion profit when it reported huge gains from restructuring.
Group revenue rose close to 40% year on year to $2.9 billion, led by a 47% jump in passenger revenues.
Garuda and Citilink carried close to 20 million passengers during 2023, an increase of 34.5% year on year. At December 2023, passenger volumes had recovered to 67% of pre-pandemic levels, while capacity reached around 65% of 2019 levels.
Garuda says it “remains on track for revenue growth” this year, as it looks into diversifying its income streams, including from the religious pilgrimage charter sector.
Operating costs for the full year rose about 4% to $2.6 billion, with fuel costs accounting for more than a third of expenses. However, Garuda notes that fuel cost “optimisation” helped save the group about $16.1 million in December.
Mainline operator Garuda posed a net profit of $220 million, with revenue growing 55% year on year to $1.9 billion, Citilink, meanwhile, reported a $12 million net profit, on the back of an 18% increase in revenues to $868 million.
