No-frills carrier SpiceJet today reported a net loss of Rs 38.06 crore in June quarter on a one-time provisioning of Rs 63.5 crore, higher fuel cost and weak rupee.
The Gurugram-based airline had posted a net profit of Rs 175.2 crore in the same period last year.
Its net income rose 20 per cent to 2,277.80 crore in the reporting quarter, compared with Rs 1,886.30 crore in the year-ago period, the airline said.
"As we start inducting the new fuel-efficient 737 Max and the Bombardier Q400, we will be able to significantly reduce our overall costs even as we aggressively expand our network both in India and overseas," said Ajay Singh, chairman, SpiceJet.
The airline is set to induct the latest fuel-efficient aircraft from Boeing 737 Max, which will reduce the costs by 8-9 per cent, it said.
A total of 15 aircraft will be inducted including 11 737 Max and four regional jets, Bombardier Q400s, by the end of the third quarter, the airline said.
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The company has taken a provision of Rs 63.5 crore in the quarter as an exceptional item on account of an arbitration award that cited interest payable of Rs 92.5 crore and interest receivable of Rs 29 crore for SpiceJet, it said.
In addition, SpiceJet accounted for Rs 51 crore as forex losses, that includes Rs 25.2 crore provision of aforesaid forex revaluation, due to rupee depreciation, it added.
With this one-time provision (Rs 63.5 crore), SpiceJet has now fully provided for the maximum amount that may be payable under the arbitration award, the airline said.
Last month an arbitration tribunal rejected the Rs 1,323-crore damages claim from SpiceJet and a bid to take control of the airline by its previous owner, Kalanithi Maran, and his company Kal Airways, after a bitter share transfer dispute.
The case dates back to January 2015, when Singh, who partially owned the airline earlier, bought it back from Maran after it almost went belly-up.
While the tribunal asked Maran to pay Singh and the airline Rs 29 crore in penal interest, Singh was asked to refund Rs 579 crore along with the interest to Maran.
An additional amount of Rs 203 crore was incurred on account of increase in cost of jet fuel and an amount of Rs 44 crore on account of forex losses during the June quarter.
"A superior revenue performance ensured that an amount of Rs 99 crore of these losses was offset by an increase in revenue," the airline said.
The previous generation and the new generation Q400s with additional seating capacity is expected to improve the overall operating economics of this aircraft by 1518 per cent, SpiceJet said, adding, "This will also enhance capacities on the regional routes, including those operating under government's regional connectivity scheme, Udan."