Russia’s UTair Airline reported 1H 2016 net loss of RUB684.9 million ($10.7 million), narrowed from the carrier’s RUB1.77 billion loss in 1H 2015. Revenue rose 13.5% year-over-year (YOY) to RUB33.7 billion. Operational costs increased 20% YOY to RUB32 billion. The airline’s operational profit for the first half fell 43.8% YOY to RUB1.7 billion, ATWonline reported.

The results are published in accordance with International Financial Reporting Standards.

“UTair continues to realize its restructuring program focused on cost reduction, productivity increases and the continued optimization of its aircraft lease portfolio,” the report stated. The 1H 2016 interim financial statements assume the company will continue on a going concern basis despite the fact it has negative equity of RUB11.8 billion, short-term assets exceed short-term liabilities by RUB2.8 billion. The company benefits from a number of the Russian government guarantees that allowed it to restructure its financial liabilities over a number of years.

The results for the 1H 2016 were affected by a one-off charge for early termination of aircraft orders and lease agreement for RUB500 million.

Company management states in its 1H 2016 report that it expects the company to return to sustained profitability next years and use profits thus generated to return to positive equity.

UTair is one of top five Russian airlines with bases at Moscow Vnukovo International Airport and Surgut and Tyumen Airports in Siberia.