Garuda Indonesia has returned to the black after a challenging 1H2011 and has a bullish outlook, particularly in the fast-growing Indonesian domestic market. Garuda aims to tap into the expected 14% to 16% annual growth in Indonesia’s domestic market by pursuing rapid expansion at its budget unit Citilink, which it expects will be profitable starting in 4Q2011, and establishing a new regional jet operation from 2H2012.

Garuda is now preparing to spin off the Citilink unit into a separate company in early 2012, which will enable the LCC to pursue faster growth. Citilink recently began operating its first Airbus A320 and aims to be operating 20 of the type by the end of next year. Garuda is also planning to soon place an order for 18 large regional jets, which will be used primarily to improve connections at secondary bases.