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SpiceJet Q1 profit doubles to ₹149 cr
No-frills airline SpiceJet reported a net profit of ?149 crore for the first quarter of 2017 against a profit of ?73 crore for the same period of the previous year.
This is the sixth consecutive profitable quarter for the Gurgaon-headquartered low-cost airline. In a statement the airline said that on an EBITDA basis SpiceJet reported a profit of Rs. ?215 crore. During the latest quarter, capacity deployed by SpiceJet registered a growth of 37 per cent over the same quarter last year and operating revenue stood at ?1,522 crore (?1,113 crore previously).
The average fare charged by the airline stood at ?3,605 during the first quarter of this year compared to ?3,715 during the same quarter in the previous year.
Ancillary revenues
During the latest quarter, the airline reported a 64 per cent increase in revenues from ancillary revenues compared to the same period in the previous year. Airlines in India earn ancillary revenues from unbundling services such as charging for sitting in the first few and some other seats which offer additional leg room space, by charging for meals/drinks ( they have to offer water free of charge), charging for checked in bags, sports equipment and musical instruments among others.
Profits for the quarter were adversely impacted by Rupee depreciation, inflation and the presence of expensive wet lease aircraft, the airline said in the statement.
Rupee depreciation
Ajay Singh, Chairman and Managing Director, told newspersons after the results were announced that during the latest quarter the airline suffered a loss of ?33 crore due to the depreciation of the rupee, while it is likely to save substantial funds as the airline has now converted the wet lease of aircraft into dry lease.
A wet lease involves leasing an aircraft with a foreign crew, while in a dry lease, the airline leasing the aircraft gets it without the crew. Typically, the leasing rates for an aircraft being taken on dry lease are 20 per cent lower than what an airline pays for inducting an aircraft on wet lease.
“Currently, the company has zero bank debt. We have cleared all tax liabilities. All airport liabilities have been cleared. We have paid all the banks and do not have a rupee outstanding with them. There is no outstanding with vendors,” Singh said.
SpiceJet plans to induct three Boeing 737 during October and November this year. The airline also plans to station another three Bombardier Q 400 aircraft in Kolkata to strengthen operations to the North-East.
On Wednesday, the airline stock closed at ?65.30, up 8.95 per cent from the previous day’s closing, on the BSE. Al Davis Womens Jersey
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