SpiceJet trims September quarter losses by 45 pct to Rs 310.44 crore
Low cost carrier SpiceJet on Friday reported a reduction in its losses by 45% during the July to September quarter to Rs 310.44 crore from Rs 559.49 crore it posted during the same period of the previous year.
The improved performance of the Gurgaon-based carrier came on the back of higher load factor and passenger revenue generated by the airline and lower expenses incurred by it during the quarter as compared to the year before.
The Kalanithi Maran-promoted no frill carrier’s revenue increased by 15% to Rs 1,449.94 crore during the September quarter while its expenses were down by 2% to 1,749 crore.
The carrier also registered a 19% increase in its load factor, and 12% increase in its RASK (Revenue per Available Seat Km) while bringing down the CASK (Cost per Available Seat Km) by 7%, during the quarter that ended on September 30, as compared to the year before.
“There were Rs 75 crore of one-off and restructuring expenses in the quarter. Excluding these expenses, Year-on-Year loss (YoY) reduced by 57% or Rs 313.9 crore, EBITDAR margin improved from -19% to +4% YoY or an improvement of Rs 283.6 crore,” SpiceJet said in a statement.
“The revenue results above clearly indicate that our market stimulation efforts are driving not just higher loads, but higher unit revenue (RASK) as well; additionally our continued focus on ancillary revenues are showing substantial results with an increase 31% YoY,” SpiceJet added.
SpiceJet has rolled out several discounts in the past three quarters, which have often lead to price war of sorts with other airlines following up with discounts. The airline has offered as much as 22 discounts since the beginning of the calendar year.
The statement added that SpiceJet’s market stimulation efforts have had a positive impact on the travel industry as a whole by helping increase demand to fill seats that would otherwise go empty.
“This (discounts) has benefiting not just the airline through incremental revenue, but also customers who are getting much more affordable fares if they are willing to book early, and for all other players in the travel value chain due to the increased volume of travel.”
However, on a sequential basis, the carrier’s revenues fell by 14.26% while its losses widened by 150%, during the September quarter.
At present Indian commercial airlines are hugely loss making due to several factors like high jet fuel prices and taxes, low yield per seat, coupled with high interest rates which have dragged most carriers in the red.
Aviation information consultancy Centre for Asia Pacific Aviation (CAPA) observed in a July 15 report that India’s airlines are heading for another big loss in FY2015.
SpiceJets’ shares closed at Rs 15.23 per share on the BSE on Friday, up 1.40%. The benchmark Sensex closed at 28,046.66 points, up 0.38%.