SpiceJet posts 59 Crore Q4 loss on high jet fuel prices

By SiliconIndia   |   Monday, May 30, 2011
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New Delhi: Low-cost carrier SpiceJet posted a net loss of Rs. 59 crore for the last quarter of 2010-11 fiscal due to high jet fuel prices. The company had reported a net profit of Rs. 27 crore during the corresponding period of 2009-10. "One of the main reasons which affected our operations was fuel costs, which accounted for about 52 percent of total costs during the quarter," SpiceJet CEO Neil Mills said. Total revenues of the company, however, grew by 32.51 percent to Rs.758 crore during the quarter against Rs. 572 crore reported during the corresponding quarter of FY'10, he said. For 2010-11, net profit jumped by 64.63 percent to Rs. 101.15 crore compared to a net profit of Rs. 61.44 crore in FY'10. Total income rose by over 33 percent to Rs. 2,934.38 crore in FY11 compared to Rs. 2,202.40 crore of 2009-10. "We are pleased with our results. Despite higher fuel costs in the last quarter and irrational behavior on pricing front by the competitors, we have managed to keep costs under control. We have, in fact, outperformed the industry during the year as our domestic passenger traffic has increased by 30 percent, while industry average was 19 percent," Mills said. The expenses of the airline on air turbine fuel (ATF) were higher at 41.79 percent of its total revenues during the year against 36.97 percent in FY'10. Mills also said that the coming quarters are going to be tough for both the industry and the airline "due to expensive fuel prices and irrational pricing behaviour of the competitors". He, however, declined to comment on what kind of pricing pressures are applied by other airline companies. Talking about adding new aircraft to its fleet, Mills said that of its order of 15 Q400 NextGen turboprop aircraft placed with Bombardier Inc of Canada, the low-cost airline will receive four in July. "We expect to get four aircraft from Bombardier in July and they will be based at Hyderabad airport. We intend to fly it to destinations in the range of an hour or so," he said, adding that the company expects to get 11 such aircraft from Bombardier by March, 2012. The statement added that the airline will have around 70 aircraft, including the Q400 Bombardier aircraft, in its fleet by 2013.
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