SpiceJet Q4 net profit up 22% to INR 56.3 crore
SpiceJet reported a profit of INR 56.3 crore for the traditionally weak quarter ended March 31st, 2019 as against INR 46.2 crore in the same quarter last year. In comparison to Q3 FY19, the airline managed to generate higher profits despite challenges on account of seasonality and more importantly grounding of its 13 MAX aircraft. The reported quarter profit does not include any form of reimbursements or compensation on the grounded aircraft and for which the Company continues to work with the manufacturer. The airline reported a net loss of INR 316.1 crore in FY 2019.
Operating revenues were at INR 2,531.3 crore for the reported quarter and INR 9113.2 crore for the fiscal 2019. On an EBITDA basis, profit is INR 122.8 crore for the reported quarter and INR 48.4 crore for the fiscal 2019. On an EBITDAR basis, the profit is INR 523.3 crore for the reported quarter and INR 1,345.1 crore for the fiscal 2019.
The year under review posed multiple unprecedented challenges such as the world-wide grounding of the Boeing 737 MAX which led to the overnight grounding of SpiceJet’s MAX fleet. This could have led to huge cancellations and passenger disruptions but the Company swiftly moved by mounting additional frequencies, inducting planes on wet lease and rationalising and optimising the use of its existing fleet. Further, this year saw a 25% increase in aviation turbine fuel prices and 9% depreciation of the Indian rupee that resulted in cost escalations of INR 695 crore and INR 285 crore respectively.
Ajay Singh, Chairman and Managing Director, SpiceJet said, “SpiceJet has posted a strong recovery in last two quarters after suffering a loss of INR 427.5 crore in the first two quarters due to steep increase in fuel costs and sudden depreciation of the Rupee. This recovery comes despite the unprecedented challenges we faced during Q4 FY2019 which saw the grounding of as many as 13 of our MAX planes.”
“With a massive fleet expansion this fiscal, a favourable operating environment, a likely return of the B737 MAX in July, significant improvements in yields and prime slots at key airports, we are confident of a strong performance for FY2020.”
Since April 1, 2019, the airline has announced 106 new flights including 73 flights connecting Mumbai, 16 flights connecting Delhi and eight flights connecting Mumbai and Delhi, its fleet size stands at 100 and the Company has hired over a thousand highly trained professionals to chart the next stage of its growth. The Company has robust systems and processes to scale its operations, which was demonstrated as it added 25 airplanes in 30 days.
The airline is eyeing an aggressive expansion plan across both its domestic and international network. As part of its international expansion strategy, SpiceJet has signed a Memorandum of Understanding for interlining and codeshare arrangement with Emirates, one of the world’s largest airlines. While the new partnership will immensely benefit passengers travelling on both airlines, it will significantly boost operating revenues. This will enable SpiceJet passengers from India to enjoy seamless connectivity leveraging Emirates vast network across Europe, Africa, America and the Middle East. Those travelling to India on Emirates will be able to travel to 53 destinations across SpiceJet’s domestic network.
Currently, SpiceJet operates to 53 domestic and nine international destinations. It is the largest regional player in the country with 42 daily UDAN flights and operates to 12 destinations under the regional connectivity scheme providing air connectivity to the remotest corners of the country.
The 2018-19 fiscal, yet again, witnessed the airline’s unyielding commitment towards driving UDAN, and on-boarding six destinations across the country onto the national aviation map including – Adampur, Kanpur, Kishangarh, Pakyong, Lakhimpur and Jharsuguda.
Through SpiceXpress, the dedicated air cargo arm of SpiceJet, the airline also launched its freighter service on the Guwahati–Hong Kong sector and became the first airline to connect North East India with South East Asia through a freighter route. The airline sees huge potential in the North East market and going forward, plans to connect all the seven North Eastern states with Guwahati, thereby building the latter in to a cargo hub for the entire region. Currently the freighter fleet comprises of two Boeing 737NG Freighters and four more are expected to be added during FY2020.
In terms of operational parameters, SpiceJet had the best passenger load factor amongst all airlines in the country during the quarter and the year. The average domestic load factor for the quarter was 92.58% while for fiscal 2019 it was 93%. For 49 months in a row, SpiceJet has flown the highest load factors in the Indian aviation market, a feat unparalleled globally.