National airline Garuda Indonesia booked a net loss of US$2.03 million for the first half of the year, compared to a $22.4 million loss in the same period of 2011.
The improvement stemmed from better management and rising local demand, the company said.
Garuda said its revenue rose 18% to $1.51 billion in the January-June period this year.
With demand for international flights suffering from economic crises in Europe and the United States, Garuda is trying to boost its presence in Indonesia.
But competition at home is warming up, with several budget airlines moving into the premium market.
And last week, Malaysia’s AirAsia, which is setting up a base in Jakarta, expanded its presence in the Indonesian market via the $80 million purchase of a controlling stake in Batavia Air.
Garuda has announced plans to double its fleet in anticipation of the Association of Southeast Asian Nations’ open skies policy, set to take effect in 2015.
Under the policy, airlines in the region will have more freedom to serve routes in other Asean countries.
In April, Garuda signed a $2.5 billion deal to purchase 11 A330-300 planes from Airbus.
