Jet Airways (India) Ltd, top airline by market share, on Friday said it swung to a net loss, compared with profit a year ago, due to rising fuel prices and a forex loss in the quarter. For the quarter ended September, it reported a net loss of Rs 714 crore, compared to Rs 12 crore in the same period lasy year. It had made a profit of Rs 10 crore in the same quarter last year.
Total income rose to Rs 3,293 crore, from Rs 3,068 crore in the comparable period last year.
"Tough pricing environment, lean season impact and high fuel prices impacted the results," the carrier said in a statement. Earnings were also hit by an exceptional forex loss of $52.7 million due to depreciation of the rupee. Fuel prices went up by 41 per cent on year, hitting profitability. Despite placing huge orders worth $50-billion with Boeing and Airbus, India's airlines are struggling to make money.
The Indian aviation market is one of the fastest growing with passenger numbers growing at 19 per cent. Jet carried 16 per cent more passengers in the quarter. Its revenue grew from Rs 3,067 crore in the second quarter of last year to Rs 3,293 crore during the current quarter.
A release from the company said their business and first class seat factors are holding and they should see further improvement in the third quarter.
Jet's rival, Kingfisher Airlines, has been forced to cancel scores of flights this week to cut losses, as it does not have money to fly full capacity. State-run Air India is operating on government life support.
In the scenario, Jet Airways has managed to ensure it remains competitive through stringent cost control, strategic code shares that offer greater connectivity via a wider network, route rationalisation and fiscal prudence, the airline said.
"All of these non-payroll initiatives will augur well for the airlines performance in second-half of the current financial year,” the company said. The airline will be doing a sale and leaseback of some of its aircraft to repay existing high cost working capital loans.
The airline also said it was exploring options to raise finances to meet various short- term and long-term obligations including financial support to its unit, JetLite.
