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Spicejet posts Q4 net loss at Rs 816 cr on weak demand

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The low-cost air carrier reported consolidated net loss of Rs 816.24 crore in Q4 March 2020 compared with net profit of Rs 72.51 crore in Q4 March 2019.

The company said that the business was adversely impacted due to the COVID-19 pandemic and the nation-wide lockdown that resulted in suspension of flight operations.

Total revenue from operations jumped 13.11% to Rs 2,867.02 crore in Q4 March 2020 over Rs 2,534.69 crore in Q4 March 2019. Pre-tax loss stood at Rs 816.24 crore in Q4 March 2020 as against pre-tax profit of Rs 72.53 crore in Q4 March 2019. The result was announced during trading hours today, 29 July 2020.

Spicejet's capacity (in terms of seat kilometre) grew 23%. The company recorded an operating loss of Rs 333.70 crore. Revenue from cargo surged 94%. The company registered industry's highest domestic load factor of 90%.

During the quarter, the company added 38 aircraft to fleet and operated 570 average daily passenger flights before COVID‐19. It also added five 90‐seater Q400 aircraft taking Bombardier fleet size to 32.

Operating revenues for Q4 March 2020 were at Rs 2,863.90 crore for the reported quarter. On an EBITDA basis, loss stood at Rs 223.60 crore for the reported quarter. On an EBITDAR basis, the loss stood at Rs 90.90 crore for the reported quarter.

The company said that FY2020 posed multiple unprecedented challenges such as the COVID-19 pandemic and the world-wide grounding of the Boeing 737 MAX which led to the overnight grounding of Spicejet's MAX fleet.

On the grounded Boeing 737 MAX aircraft, the company continues to incur various costs with respect to these aircraft and during this quarter ended 30 March 2020 on account of its inability to undertake revenue operations, the company has recognized Rs 134.5 crore towards aircraft and supplemental lease rentals and other identified expenses, as other income for the reported quarter. This is a part recognition of the total reimbursements, on which the company is working with the aircraft manufacturer, towards various ascertained costs and losses incurred by the company on this aircraft.

Ajay Singh, the chairman and managing director (MD) of SpiceJet, has said that: "Two key factors that adversely impacted our performance and bottom line was the COVID‐19 pandemic that started affecting demand adversely from mid‐February and grounding of the 737 MAX, which has been out of service for over a year now. Despite the year long grounding of the MAX aircraft, SpiceJet ran a profitable operation till COVID hit demand from mid‐ February. Indian and the global aviation industry are going through the toughest‐ever phase in aviation history. We at SpiceJet have constantly adapted to the changing economic environment and I am happy that our cargo operations have performed very well. I am confident that things will only improve in the times to come. We remain cautious but optimistic about the future."

Meanwhile, the chief financial officer (CFO) of Spicejet, Kiran Koteshwar, has decided to pursue an opportunity overseas after serving the company for over 13 years. Koteshwar will remain with SpiceJet till 31 August 2020.

SpiceJet is a domestic low-budget air carrier which provides scheduled flights between major cities in India. Since 1 April 2019, the airline has added 38 aircraft which included 737s, Q400s and freighters.

Shares of Spicejet rose 0.83% to Rs 48.35. The scrip hovered in the range of Rs 46.80 to Rs 49.90 during the day.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, July 29 2020. 15:38 IST