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Jet Airways (India) drops as Q4 net loss widens

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The Q4 result was announced after market hours on Friday, 24 May 2013.

Meanwhile, the S&P BSE Sensex was up 92.54 points or 0.47% at 19,796.87.

On BSE, 45,000 shares were traded in the counter as against average daily volume of 25.53 lakh shares in past two weeks.

The stock hit a high of Rs 556 and a low of Rs 537 so far during the day.

Jet Airways (India)'s revenue declined 2.49% to Rs 3990.50 crore in Q4 March 2013 over Q4 March 2012.

Revenues from domestic operations in Q4 March 2013 stood at Rs 1602.80 crore, accounting for 40.2% of total revenue. Seat factors remained at around 74.8% for Q4 March 2013, as against 77.1% for Q4 March 2012. Capacity in terms of ASKM of 3,188 million registered in Q4 March 2013, as against 3,493 million in Q4 March 2012.

 

Revenues from international operations in Q4 March 2013 stood at Rs 2387.70 crore, accounting for 59.8% of total revenue. Achieved seat factor of 84.4% in Q4 March 2013, compared with 86% in Q4 March 2012.

Jet Airways (India) reported net loss of Rs 485.50 crore in the year ended 31 March 2013 (FY 2013), lower than net loss of Rs 1236.10 crore in the year ended 31 March 2012 (FY 2012). Revenue rose 13.8% to Rs 17068.70 crore in FY 2013 over FY 2012.

On consolidated basis, Jet Airways (India) reported net loss of Rs 779.28 crore in FY 2013, lower than net loss of Rs 1420.13 crore in FY 2012. Total income from operations rose 12.79% to Rs 18840.56 crore in FY 2013 over FY 2012.

Jet Airways (India) said that the performance of the company in Q4 March 2013 was impacted due to high fuel prices, rupee depreciation and increase in cost of operations. Temporary slowdown in demand has resulted into capacity reduction, the company said. This has resulted in aircraft on ground. Few of them were redeployed to profitable international routes, Jet Airways (India) said in a statement.

The impact of aircraft on ground for the quarter was Rs 90.30 crore. There were instances of aircraft on ground during the year (FY 2013); the impact of this for the year was Rs 188.90 crore, Jet Airways (India) said. The result also includes onetime exceptional items amounting to Rs 310.20 crore. This is mainly due to maintenance events, payroll arrears, SFIS reversal on account of expiry of licence and loss on exchange fluctuation. Additionally the company also had certain credits on account of compensation credit and profit on sale and lease back of London slots, Jet Airways (India) said.

Mr. Hameed Ali, acting Chief Executive Officer, Jet Airways (India) said, "Sluggish economic scenario and high yields have resulted in decrease in market demand and capacity. Rupee depreciation, high fuel prices, increase in landing & navigation costs and Increase in cost of operations including impact of onetime cost and aircraft on ground has impacted the quarterly results. As India's premier airline, we continue to strive in our endeavor to enhance our guest experience through various strategic marketing and customer friendly initiatives. This will help us to achieve customer delight, which in turn will further help Jet Airways build its industry benchmarks of service excellence and quality, with convenience and comfort".

With regard to its future business outlook, Jet Airways (India) said that the Rupee depreciation and increase in cost of operations, especially landing & navigation cost continues to be a cause of concern. Significant increases in landing & navigation charges at key metros will lead to airlines passing on the costs to the passenger, which may affect the passenger growth in short term, the company added.

Jet Airways (India) said that the demand growth is expected to climb up to a 10-12% range. As against this, capacity increases are expected to be moderate in the industry. Airlines are regaining pricing power and industry load factors are starting to go up, the company said.

Jet Airways (India) said it continues with its endeavor in cutting costs and improving productivity. Initiatives such as enhancing ancillary revenues, discontinuing loss making routes, sale/sale and lease back of aircraft will help the company in the medium to long term, the company said.

Jet Airways (India) said its international business continues to show healthy trends which are reflecting in the seat factors. The company said it is selectively adding flights to profit making markets such as Gulf & Middle East and ASEAN routes and discontinuing loss making routes.

Jet Airways (India) said that the proposed Jet-Etihad deal will bring immediate revenue growth and cost synergy opportunities for both the airlines and will help strengthen Jet Airways balance sheet. The company said that the key cost benefits and synergies in fleet acquisition, maintenance, joint purchasing opportunities for fuel, spare parts, equipment and catering supplies, as well as external services such as insurance and technology support will come through. Other areas of co-operation will include joint training of pilots, cabin crew and engineers, as well as maintenance of common aircraft types and consolidation of guest loyalty programs, the company added. The alliance will bring significant guest benefits with expanded code sharing, creating a combined network of 140 destinations. All of the above will result in accelerated return to sustainable profitability, Jet Airways (India) said in a statement.

The Jet Airways group currently operates a fleet of 109 wide and narrow-bodied aircraft under the Jet Airways and JetKonnect brand. Jet Airways a full service airline with one of the youngest fleets in the world operates a network that includes flights to 77 destinations spanning the length and breadth of India and destinations in Europe, North America (USA & Canada) , the Middle East and Asia. The JetKonnect service is a dedicated product designed to meet the needs of the low fare segment. With a mixed fleet of Boeings and ATR aircraft, JetKonnect's convenient schedules, reliable service and low fare offer bring greater value and a seamless flying experience to its customers. Jet Airways and JetKonnect together operate over 580 flights daily.

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First Published: May 27 2013 | 9:25 AM IST

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