Jet Airways records biggest quarterly loss; Rs 240 crore loss for Spicejet
Ironically, in the July-September quarter last year, the industry was boasting of an impressive turnaround led by Jet Airways.
By ET Bureau | Updated:
MUMBAI: Jet Airways and SpiceJet, two of the country's leading airlines, announced hugely disappointing numbers on Friday, underlining the dire state of the country's aviation sector as it grapples with soaring costs, price war and worsening economic conditions.
Jet, the biggest airline by market share, recorded its biggest quarterly loss of 714 crore while SpiceJet, the low-fare competitor, registered a loss of 240 crore against a profit of 10.31 crore in the year-ago period.
Analysts said the results were below their expectations. "The results have been disappointing and below our expectations," said Jasdeep Walia, analyst with Kotak Institutional equities.
Ironically, in the July-September quarter last year, the industry was boasting of an impressive turnaround led by Jet Airways, which posted a net profit of 12.4 crore.
Unrealised foreign exchange losses alone contributed to 275 crore of Jet's losses while its aircraft fuel bill rose 50% to 1,491 crore from a year earlier.
Jet said its revenues increased 4% to 3,332 crore. SpiceJet's revenues increased 25.89% to 759.02 crore. Staff costs increased 62.24% to 86.38 crore while fuel costs jumped 83.34% to 478.14 crore.
Indian aviation companies have been pummeled by high costs, discounted fares and slowing demand. Jet & SpiceJet's performance, along with Kingfisher's deepening troubles, is likely to worsen the outlook for the sector.
"The loss is mainly due to unrealised forex losses. We are not very worried at the moment as the situation will improve in the long term. We expect the rupee to appreciate in the long run but fuel costs are a worry," said M Shivkumar, senior VP at Jet Airways.
Jet said it will be doing a sale and lease back of some of its aircraft to repay existing high-cost working capital loans and is also exploring options to raise finances to meet various short-term and long-term obligations.
Jet Airways shares rose 2.16% to 265.35 while SpiceJet gained 3.62% at 24.30.
Jet, the biggest airline by market share, recorded its biggest quarterly loss of 714 crore while SpiceJet, the low-fare competitor, registered a loss of 240 crore against a profit of 10.31 crore in the year-ago period.
Analysts said the results were below their expectations. "The results have been disappointing and below our expectations," said Jasdeep Walia, analyst with Kotak Institutional equities.
Ironically, in the July-September quarter last year, the industry was boasting of an impressive turnaround led by Jet Airways, which posted a net profit of 12.4 crore.
Unrealised foreign exchange losses alone contributed to 275 crore of Jet's losses while its aircraft fuel bill rose 50% to 1,491 crore from a year earlier.
Jet said its revenues increased 4% to 3,332 crore. SpiceJet's revenues increased 25.89% to 759.02 crore. Staff costs increased 62.24% to 86.38 crore while fuel costs jumped 83.34% to 478.14 crore.
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Indian aviation companies have been pummeled by high costs, discounted fares and slowing demand. Jet & SpiceJet's performance, along with Kingfisher's deepening troubles, is likely to worsen the outlook for the sector.
"The loss is mainly due to unrealised forex losses. We are not very worried at the moment as the situation will improve in the long term. We expect the rupee to appreciate in the long run but fuel costs are a worry," said M Shivkumar, senior VP at Jet Airways.
Jet said it will be doing a sale and lease back of some of its aircraft to repay existing high-cost working capital loans and is also exploring options to raise finances to meet various short-term and long-term obligations.
Jet Airways shares rose 2.16% to 265.35 while SpiceJet gained 3.62% at 24.30.
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