Mumbai: Gurgaon based low cost airline SpiceJet, on Friday, reported net profit of Rs 238.40 crore in the October- December quarter of the current financial year on the back of a substantial reduction in fuel cost, rise in revenues due the increase in the number of passengers carried and better operating efficiency.
In the corresponding quarter of FY15 SpiceJet had posted a net loss of Rs 275.02 crore.
According to the company, this was the highest ever net profit posted by the company since its inception in 2005.
The low cost airline was supposed to wind up its operation last winter after debts ballooned and daily operations came to a grinding halt which propelled founder Ajay Singh to take the reins of the company in his hand.
As an indication of the turnaround in the fortunes of the airline, revenue for the quarter increased by 11.35% y-o-y to Rs 1,459.95 crore compared to Rs 1311.71 crore in the corresponding quarter. The recovery in operations within a year was possible due to the substantial reduction in crude oil prices that pulled down the cost of jet fuel which constitutes 40%- 50% of the operating cost of an airline.
In the given quarter, SpiceJet fuel expense decreased by 34.81% y-o-y to Rs 366.63 crore compared to Rs 562.37crore during the same period last fiscal.
According to sector experts, all airline companies will continue to benefit from low fuel prices and with prices slipping below $30 per barrel, expenses are expected to come down further.
Another major expense for airlines is the aircraft lease rentals which increased by 5.86 % y-o-y to Rs 227.72 crore.
To Read the News in Full 23/01/16 Financial Express
In the corresponding quarter of FY15 SpiceJet had posted a net loss of Rs 275.02 crore.
According to the company, this was the highest ever net profit posted by the company since its inception in 2005.
The low cost airline was supposed to wind up its operation last winter after debts ballooned and daily operations came to a grinding halt which propelled founder Ajay Singh to take the reins of the company in his hand.
As an indication of the turnaround in the fortunes of the airline, revenue for the quarter increased by 11.35% y-o-y to Rs 1,459.95 crore compared to Rs 1311.71 crore in the corresponding quarter. The recovery in operations within a year was possible due to the substantial reduction in crude oil prices that pulled down the cost of jet fuel which constitutes 40%- 50% of the operating cost of an airline.
In the given quarter, SpiceJet fuel expense decreased by 34.81% y-o-y to Rs 366.63 crore compared to Rs 562.37crore during the same period last fiscal.
According to sector experts, all airline companies will continue to benefit from low fuel prices and with prices slipping below $30 per barrel, expenses are expected to come down further.
Another major expense for airlines is the aircraft lease rentals which increased by 5.86 % y-o-y to Rs 227.72 crore.
To Read the News in Full 23/01/16 Financial Express
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