Once celebrated for posting a profit of Rs. 3.8 billion in the 2023/24 financial year, SriLankan Airlines has now reported a staggering loss of Rs. 7.6 billion in 2024/25, raising serious concerns about the future of the national carrier.
SriLankan Airlines has published its annual report for the 2024/25 financial year, revealing the depth of its financial woes. According to the report, the airline posted a loss of Rs. 7.59 billion between April 01, 2024 and March 31, 2025, reversing the profit of Rs. 3.87 billion reported in the previous year. The parent company was not alone in its struggles as the SriLankan Group as a whole also slipped into the red, recording a loss of Rs. 2.7 billion in 2025 compared to a Rs. 7.9 billion profit in 2024.
The report highlights several factors behind this sharp decline. While the overall expenses of the group have slightly reduced compared to the previous year, revenues dropped significantly. In 2023/24, SriLankan Airlines earned Rs. 339,591.65 million, but in 2024/25 that figure fell to Rs. 303,093.89 million, representing a revenue shortfall of Rs. 36,498 million.
Passenger revenue took the biggest hit. Despite a rise in tourist arrivals to Sri Lanka in 2024, the airline carried only 3.5 million passengers, a 4% contraction compared to the previous year. Passenger revenue for 2024/25 was reported at Rs. 234.5 billion, down from Rs. 276.2 billion in the previous financial year, marking a 15% drop. This decline was largely attributed to the limited number of aircraft available, delays in aircraft being released from maintenance, and engineering-related disruptions that severely constrained operational capacity. The airline’s annual Available Seat Kilometers (ASK), a key measure of capacity, contracted by 5%.
Employee costs also came under scrutiny. For the 2024/25 financial year, SriLankan Airlines employed 6,071 staff, with 67% being male and 33% female. The workforce included 291 managers, 272 pilots, 940 cabin crew, 615 aviation engineers and technicians, and 3,953 trainees, interns, and executives. Employee costs for the year amounted to Rs. 32,799 million, reflecting an increase of Rs. 538 million compared to the previous year, even though overall staff-related expenses slightly declined to Rs. 9,469 million.
Ownership details show that as of March 31, 2025, the Sri Lankan government held 99.77% of the airline’s shares, while the Employees Provident Fund owned 0.09% and other minor stakeholders accounted for 0.14%.
The financial crisis has raised alarms about the carrier’s sustainability. The Auditor General’s report issued by the National Audit Office on August 12, 2025, emphasized the uncertainty surrounding SriLankan Airlines’ ability to continue as a going concern. The report pointed out that the company’s current liabilities exceed its current assets, casting significant doubt on its financial stability. It noted that the Rs. 7,594 million loss, coupled with ongoing operational challenges, underlined the airline’s fragile state.
While operational disruptions were cited as a key reason for the revenue collapse, deeper systemic issues have also come into play. Delays in fleet management, engineering inefficiencies, and over-reliance on outdated systems have left the airline vulnerable. The mismatch between growing tourism numbers and the airline’s ability to capture that demand exposed weaknesses in planning and execution.
Critics argue that despite high employee costs and management overheads, the airline has failed to modernize its operations and fully capitalize on available opportunities. The contrast with regional carriers, many of which have managed to rebound strongly post-pandemic, has raised questions about SriLankan Airlines’ long-term competitiveness.
The financial crisis of 2025 is a sharp reminder that SriLankan Airlines cannot rely on state ownership and subsidies alone to survive. With liabilities outpacing assets and losses mounting, restructuring may no longer be an option but a necessity. The challenge now lies in addressing operational inefficiencies, streamlining costs without compromising service quality, and most importantly, rebuilding passenger trust through reliable schedules and consistent services.
For a nation dependent on tourism and global connectivity, the national carrier’s health is directly tied to economic stability. The Rs. 7.6 billion loss in 2025 is not just a financial figure, it reflects lost opportunities, weakened competitiveness, and the urgency of reform. Without decisive action, SriLankan Airlines risks being weighed down further, with each financial year eroding its credibility as a viable national carrier.
