HARSH COST-CUTTING has begun to pay dividends for Varig, with the Brazilian flag carrier swinging back to a net profit of 170 million reals ($190 million) in 1994.
The recovery, which marks a turn-around from losses of 273 million reals, a year ago, came from sales that remained largely static at 2.9 billion reals.
As part of a severe downsizing, Varig cut its work force back by 3,600 to end the year at 24,700, reduced its fleet from 85 to 75 aircraft and restructured debt. The plan is expected to yield savings of $225 million in 1995 and $300 million in 1996.
Source: Flight International