Dar es Salaam — Air Tanzania Company Limited (ATCL) more than halved its loss over the last three years as its revival plan kicked in, according to a new audit report.
Controller and Auditor General (CAG) Prof Mussa Assad said in his latest report that ATCL cut its operating loss from Sh38.72 billion in 2015/2016 to Sh16.21 billion in 2016/2017. This was a decrease of Sh22.51 billion or 58 per cent.
"The decrease in loss is mainly attributed to the increase in total revenue by 20 per cent and a decrease in total cost by 27 per cent," said the CAG in his 2017/18 audit if government corporations.
He acknowledged the efforts the company is currently taking in the maximisation of revenue and cost containment, including the development a five-year Corporate Strategic Plan starting from 2017/2018.
"However, to fast track the operating efficiency and improvement, the government financial support is vital to facilitate the company in settling the previous years' obligations (debts) which materially increases the operating cost through interest charges," Prof Assad noted.
Government input is crucial as the CAG has named ATCL among 14 public entities which he warned are experiencing a high financial risk that makes its survival uncertain. The CAG suggested that the national carrier can do so by increasing revenues and maintaining costs at a reasonable level through instituting cost minimization techniques, strengthening service delivery to customers, and optimisation of the available flights.
The CAG pointed out in his report that ATCL has been operating at a loss for the past 10 years consecutively, from financial year 2006/7 to 2016/17.