SpiceJet Q3 profit plunges 77% due to higher oil prices, forex losses

The airline's standalone net profit was 550.7 million rupees ($7.74 million) for the quarter ended December, compared with 2.40 billion rupees a year earlier

Mumbai rains — A domestic Spice Jet aircraft is seen off the runway after it skidded off into the unpaved surface during heavy rains in Mumbai, India, Wednesday, Sept. 20, 2017. AP/PTI Photo

Last Updated : Feb 12 2019 | 2:51 AM IST

Budget carrier SpiceJet on Monday reported a massive 77 per cent fall in its net profit at Rs 55 crore owing to higher aviation fuel cost and rupee depreciation.

The Gurugram-based airline had posted a net profit of Rs 240 crore in the year-ago period, the firm said. Total income stood at Rs 2,530.8 crore for the quarter as against Rs 2,096.1 crore in Q3FY18, it said.

A strong 8 per cent increase in passenger yields helped the airline partially offset record high cost due to 34 per cent increase in crude oil prices and 11 percent depreciation in rupee.

“Despite the huge cost escalation in ATF and exchange rate, SpiceJet has done remarkably well thanks to our superior revenue performance, tight control on other costs. With a strong improvement in the macro cost environment and the increasing induction of the fuel efficient MAX aircraft, the outlook looks stronger than it has over the past year,”

SpiceJet chairman Ajay Singh said. SpiceJet continues to pursue our ambitious growth plans as it introduce new maiden flights, lead the regional connectivity scheme Udan initiative of the government, add new aircraft and explore newer growth avenues while keeping our costs under check, he said. “With sector headwinds having subsided, we are bullish on our future prospects and will continue to invest aggressively in creating capacity in line with our forecasts,” Singh added.

“The new generation 737MAX aircraft with its cost efficiencies and increased revenue opportunities (due to superior payload performance) will become a substantial portion of our Boeing fleet further improving our margins. The increased seating capacity on the Bombardier Q400s will also result in improved margins,” he said.

The airline also said that its average fare were up 25 per cent over the July-September quarter of the current fiscal year while it the passenger load factor stood at 91.6 per cent during the reporting quarter. SpiceJet bagged 36 new sectors under the third face of the Udan and launched 54 new flights including ten under Udan during Q3FY19, it said.