SpiceJet reports its highest-ever quarterly profit of INR 261.7 crore
Reports 35% growth in operational income
For the Quarter ending June 2019
Gurugram: SpiceJet is off to a great start for the Financial Year 2020 as the airline reported a net profit of INR 261.7 crore and total income of INR 3,145.3 crore for the quarter ending June 2019 as against a loss of INR 38.1 crore and INR 2,253.3 crore for the corresponding quarter last year.
Operating revenues were at INR 3,002.1 crore against INR. 2,220.4 crore for the corresponding quarter last year. On an EBITDA basis, profit is INR 747.5 crore as against INR 100.5 crore for the corresponding quarter last year. Operating expenses were at INR 2,883.6 crore as against INR 2,227.9 crore for the corresponding period last year. Effective April 1, 2019, the airline adopted the new accounting standard IND AS 116 which effectively capitalises operating leases, and as result of this the lease rentals are now reflected as interest and depreciation for the quarter ending June 2019. Additionally, owing to the retrospective treatment of this standard there is a reduction of INR 302.2 crore from retained earnings status as at April 1, 2019.
The airline operations remained stressed for a large portion of this quarter due to the continued grounding of its superior B737 MAX aircraft, which limited its ability to take its yields up owing to passenger disruptions and re-accommodation; while simultaneously increasing its fixed costs on this category of aircraft. The airline, however, spectacularly moved in to salvage this unprecedented situation with additional flights on its existing B737 NG & Q400 fleet by increasing their daily utilisation to 15-16 hours per day and 13-14 hours per day respectively, and then inducting 27 Boeing 737 NGs, at a phenomenal pace between April 01, 2019 and June 15, 2019.
On the grounded Boeing 737 MAX aircraft, the Company continues to incur various costs with respect to these aircraft and during this quarter ended June 30, 2019 on account of its inability to undertake revenue operations, the Company has recognized INR 114.1 crore towards aircraft and supplemental lease rentals as other income. This is a part recognition of the total reimbursements, on which the Company is working with the aircraft manufacturer, towards various ascertained costs and losses incurred by the Company on this aircraft.
Ajay Singh, Chairman and Managing Director, SpiceJet said, “SpiceJet has been on a spectacular growth journey and this quarter, in particular, has been very special for us. We added 32 aircraft to our fleet expanding at a pace unprecedented for a sector plagued by crisis showcasing our robust business model and proven operational capabilities.”
“We are happy that we were able to minimise passenger inconvenience by quickly filling the capacity gap created in India’s aviation sector. The results would have been vastly better but for the painful grounding of the MAX aircraft. We look forward to their swift return to service in the near future that will help SpiceJet increase its margins and provide a superior level of service.”
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