India’s second largest low-cost carrier SpiceJet’s net profit more than tripled to Rs 73 crore for the January-March quarter of FY16 on the back of increase in passenger load, higher capacity and efficient utilisation of aircraft.
The airline made a net profit of only Rs 22 crore during the same period last year. The increase in profit could have been much higher had the airlines not taken a hit of Rs 173 for the maintenance of the fleet of aircraft.
Buoyed by the financial and operational recovery, Ajay Singh, founder and chairman said that the company will order more than 100-150 aircraft and the negotiations are in the final stages. “Yes we need to add capacity and will be ordering 100 plus aircrafts in the coming few weeks. In June we will be replacing six of our wet leased aircrafts. Mostly, the orders will be delivered by 2018 till then we will be adding capacity by dry lease contracts,” added Singh
Increased number of passenger flown during the quarter led to an 85% y-o-y increase in net sales to Rs 1448.66 compared to Rs 782.56 crore in the corresponding period of the last fiscal. The Gurgaon-based airline increased it capacity during the quarter as a consequence of which the rental costs increased by 114.42% y-o-y to Rs 247.4 crore.
During the quarter, the airline was obligated to enter into new contracts and also renewed the existing ones pertaining to the maintenance of the engines of its Boeing and Bombardier Q400 aircrafts. Consequently, the aircraft maintenance cost of airline increased by 246.09% y-o-y to Rs 395.58 crore.
“This would be the best performing fourth quarter in a fiscal in our history. We have completely addressed our legacy issues, currently we have no debts on our books. Out of Rs 2,200 crore gross debt we have paid of around Rs 1,500-1,600 crore,” said Ajay Singh, chairman and managing director.
Due to the recovery in the operational efficiency of the airline, the EBITDAR (earning before interest, tax, depreciation, amortization and aircraft rentals) increased significantly by 100.51% y-o-y to Rs 393 crore for the quarter when compared to Rs 196 crore in the corresponding quarter in the FY 15.
In FY16, the no frills airline made a profit of Rs 407 crore as opposed to a loss of Rs 687 crore in the FY15.