1. InterGlobe Aviation Q1 net profit down; slows deliveries of A320neos

InterGlobe Aviation Q1 net profit down; slows deliveries of A320neos

InterGlobe Aviation, owner of Indian airline IndiGo, posted a 7 percent fall in net profit for the fiscal first quarter due to "competitive fare pressures", the company said in a statement to the stock exchange on Monday.

By: | New Delhi | Published: August 1, 2016 5:48 PM
Net profit for the April-June quarter fell to 5.92 billion rupees (.69 million) compared with 6.39 billion rupees last year. Total income from operations rose 8.7 percent to 45.79 billion rupees. (Source: Reuters)

InterGlobe Aviation, owner of Indian airline IndiGo, posted a 7 percent fall in net profit for the fiscal first quarter due to “competitive fare pressures”, the company said in a statement to the stock exchange on Monday.

Net profit for the April-June quarter fell to 5.92 billion rupees ($88.69 million) compared with 6.39 billion rupees last year. Total income from operations rose 8.7 percent to 45.79 billion rupees.

IndiGo is India’s largest airline, flying about one in three passengers in the country’s booming air travel market, and it increased its fleet size to 109 during the quarter.

The airline said it is slowing down deliveries of Airbus’ A320neo narrow-body planes to allow engine supplier Pratt & Whitney to catch up on the production of upgraded engines. “The A320neo operations continue to be a challenge,” InterGlobe said in its statement.

Pratt & Whitney, a unit of United Technologies Corp, has encountered problems with slow engine startup times and erroneous engine software messages in the new engine, already causing a delay in the delivery of planes to Indigo.

IndiGo has ordered a total of 430 A320neo aircraft, making it one of the European planemaker Airbus’ largest customers.

The company also reduced its debt by 4.59 billion rupees to 27.86 billion rupees by retiring debt-related to three aircraft taken on a finance lease.

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