CEO says PIA’s first annual profit in decades to attract ‘favorable valuation’ from investors

KARACHI: Pakistan International Airlines expects to attract “more favorable valuation” from investors after the national carrier posted an annual profit for the first time in more than two decades ahead of a second attempt by the government to sell the airline, CEO Amir Hayat said this week.
Islamabad’s attempt to privatize PIA last year fell flat when it received only a single offer, well below the asking price of more than $300 million. The cash-strapped government of Prime Minister Shehbaz Sharif is struggling to privatize several loss-making public enterprises, including PIA, as part of conditions under a $7 billion International Monetary Fund’s loan program approved last year. 
This week, PIA reported Rs9.2 billion ($33.1 million) earnings from its operations last year ended December and made a net profit of Rs26.2 billion ($93.3 million) in 2024, a development described by analysts as “good optics” for the privatization push. 
“This landmark operational profit of 26 billion rupees fundamentally strengthens PIA’s position in the context of the government’s privatization plan,” Hayat told Arab News in a written response to questions. 
“It demonstrates the inherent value and turnaround potential of the airline, making it a significantly more attractive proposition for potential investors.”
He said the results would positively influence investor confidence and potentially lead to a “more favorable valuation” during the privatization process.
Pakistan had offloaded nearly 80 percent of the airline’s legacy debt and shifted it to government books ahead of the privatization attempt. The rest of the debt was also cleaned out of the airline’s accounts after the failed sale attempt to make it more attractive to potential buyers, according to the country’s privatization ministry.
The airline has for years survived on government bailouts as its operational earnings were eaten up by debt servicing costs.
Officials say offloading the debt burden and recent reforms like shedding staff, exiting unprofitable routes and other cost-cutting measures led to the profitable year.
Hayat said the latest profit was because of “a comprehensive reforms program” executed over the past few years.
“Key drivers include maintaining strict financial discipline by implementing stringent cost control measures across the board, scrutinizing every expense, creating operational efficiencies in every aspect of flight operations, reducing ground times, and enhancing fuel efficiency,” Hayat said.
Other measures included route optimization by curtailing non-productive routes and capitalizing on profitable ones, and revenue enhancement by creating opportunities in neglected segments such as cargo, ancillary sales and codeshares and alliance partnerships.
“We view this profit not as a one-off anomaly, but as the foundational result of deep, structural changes within the airline,” Hayat added. 
While the aviation industry remained vulnerable to external variables like fuel prices and geopolitical factors, PIA had developed internal mechanisms that provided a “strong basis for continued positive performance.”
“Our clear intent and strategy are geared toward maintaining profitability moving forward and our budget for 2025 is already planned on net profitability,” the PIA CEO said. 
Muhammed Sohail, the chief executive officer at Topline Securities, said the latest profits would provide “good optics to attract more investors” to buy the airline.
Ahead of the attempt to sell the airline last year, PIA had faced threats of being shut down, with planes impounded at international airports over its failure to pay bills and flights canceled due to a shortage of funds to pay for fuel or spare parts.