Riza Roidila Mufti, Jakarta – The revision of its 2018 financial report has revealed that national flag carrier PT Garuda Indonesia suffered significant losses after the airline initially reported a profit in its balance sheet that was disputed by two of its commissioners recently.
The revised 2018 financial statement released on Friday showed that Garuda Indonesia suffered a net loss of US$175.02 million in 2018, in contrast to the net profit of $5.01 million reported in the controversial balance sheet issued earlier.
In its new 2018 balance sheet, Garuda Indonesia also reported a total revenue of $4.37 billion, the same as its previous report. However, in the new financial statement, the airline's other income totaled only $38.8 million, a far cry from $278.8 million recorded in the previous financial report – a difference of $240 million.
The Finance Ministry previously ordered Garuda Indonesia to restate its 2018's financial report after a joint investigation by the ministry and the Financial Services Authority (OJK) found that the airline had published information in its financial report that did not comply with accounting standards.
The investigation was opened after Garuda Indonesia commissioners Chairul Tanjung and Dony Oskaria refused to approve the company's financial statement owing to the discrepancies. In the report, the airline included a future income of $239 million from a 15-year contract with PT Mahata Aeroteknologi to provide in-flight entertainment and Wi-Fi in the aircraft of Garuda Indonesia's subsidiaries Citilink Indonesia and Sriwijaya Air, as part of the revenue in the 2018 financial report.
As a result, Garuda Indonesia must resubmit its 2018 financial statement and annual report. The government also slapped the airline with a fine of Rp 100 million ($7,080).
Garuda Indonesia's financial and risk management director Fuad Rizal said on Friday the financial report restatement was published following the regulator's request.
Garuda Indonesia also reported Friday a net profit of US$19.73 million for the first quarter of 2019, a significant increase from a net loss of $64.27 in the same period last year.
The net profit was supported by higher revenues from scheduled flight services, which increased to $924.93 million from $828.49 million in the same period last year. In addition, Garuda Indonesia's operating revenue rose to $171.8 million, up 27.5 percent from the amount recorded in the January to March period, last year. (hen)