Island Aviation Services, a state-owned enterprise that has been operating at a loss since the COVID-19 pandemic, has launched a project to develop housing flats for its employees.
The operator of the national airline, Maldivian, and Maafaru International Airport secured a plot of land exceeding 12,000 square feet in Hulhumale' Phase 2 last week for the construction of these flats. The land lease agreements were signed with the Housing Development Corporation (HDC) on Thursday.
Media reports, citing Island Aviation’s Managing Director Ibrahim Iyas, indicate that physical work on the project will commence soon. However, as no further details regarding the housing project have been disclosed, information remains unavailable about the financing of the project or the total number of apartments to be developed.
The company employs approximately 1,500 staff, of which more than 1,300 are Maldivian nationals.
According to Island Aviation’s 2024 audit report released by the Auditor General’s Office, the company recorded a loss of MVR 2.7 million for the year.
The financial challenges facing Island Aviation do not stem from a lack of revenue. In 2024, the company generated MVR 2.2 billion in revenue and recorded an operating profit of MVR 171.2 million after accounting for operational expenses. However, the entirety of this operating profit was consumed by financing costs.
A significant portion of Island Aviation’s financing costs is attributed to expenses related to leased aircraft.
Another major hurdle for the company is the multi-billion rufiyaa losses incurred over three years starting from the pandemic. Throughout its history, Island Aviation has accumulated total losses of MVR 1.7 billion, 90 percent of which were sustained during 2020, 2021, and 2022.
The initiative for state-owned enterprises to develop housing was first introduced during President Abdulla Yameen’s administration as part of the "Hiyaa" project. Among the companies allocated land at that time, MACL, STELCO, MWSC, MPL, and STO have already completed residential towers for their employees in Hulhumale' Phase 2. Additionally, HDC has also developed apartments for its own staff.
