Jet Airways swings to profit in June quarter on lower fuel costs

NEW DELHI (Reuters) - Jet Airways Ltd said on Friday it made a profit in the June quarter compared to a loss in the year-ago period, helped by a drop in fuel expenses and a one-time gain on sale and leaseback of engines.

Mumbai-based Jet, India's second largest carrier by market share, said net profit in the April-June quarter was at 2.21 billion rupees ($33.80 million), compared with a loss of 2.18 billion rupees the same quarter last year.

Despite rapidly rising demand for air travel in India Jet has not made an annual profit since 2007, dragged into the red by high operating costs and fierce competition for passenger fares.

A drop in fuel prices has, however, eased the squeeze on Indian airlines this year - low-cost rival SpiceJet Ltd swung to a small net profit in the last quarter - but analysts say ticket prices are still too low and costs too high for sustained profitability.

Jet, 24 percent owned by Abu Dhabi's Etihad, last year announced a cost-cutting plan and said it expected to make a full-year profit in 2017.

($1 = 65.0900 rupees)

(Reporting by Tommy Wilkes; Editing by Gopakumar Warrier)