Pay package of SpiceJet chairman Ajay Singh jumped to a three-year high during FY23 notwithstanding the second biggest loss in the airline’s history posted during the same year. The Gurugram-based low-cost carrier paid Rs 6 crore to its chairman and managing director during FY23, which is the highest since FY20 or the pre-pandemic year.
The company also paid Rs 1.8 crore to Singh during the same year, defined as ‘outstanding remuneration’ for FY22, thereby bringing the total for the year FY23 to Rs 8 crore, which is the highest since FY18, data from SpiceJet’s annual reports show.
SpiceJet did manage to bring down its losses by 13% during FY23 to Rs 1,503 crore on the back of a robust growth of 35% in revenues to Rs 8,869 crore.
However, the loss for FY23 was not just higher than the Rs 935 crore loss posted in FY20, it was the second highest loss by the airline in its recorded history or at least under Singh’s leadership. The biggest loss yearly of the company was recorded in FY22 at Rs 1,725 crore.
The company has not disclosed the pay package of Singh for FY24. Its financial performance improved in the June quarter, reporting profits for the third consecutive month. However, September saw it slip back into the red. December quarter results will be announced in due course.
With a dwindling fleet number, which is now down to 55 aircraft from 76 at the start of FY19, SpiceJet has been struggling to keep up with the changes in the Indian aviation sector including the sustained expansion by IndiGo, Air India group and newcomer Akasa Air.
On Wednesday, Singh said that the airline will use a sum of Rs 2,250 crore that it is raising to reduce debt, pay liabilities and add new destinations. He was addressing shareholders at the 39th annual general meeting virtually.
Singh also said that the carrier will launch flights to Ayodhya and Lakshadweep, without giving any indicative timeline. SpiceJet got a fresh lease of life when in December it announced plans of raising over Rs 2,250 crore through a preferential issue of shares and warrants. The amount will be raised in two tranches of Rs 1,591.5 crore by June 2024 and Rs 650 crore by July 2025.
During FY23, the company hived off its cargo and logistics business SpiceXpress into a separate entity — SpiceXpress and Logistics to unlock value for potential for prospective investors. The move resulted in a one-time gain of Rs 2,555.77 crore for the company, substantially reducing its negative net worth as a part of overall balance sheet clear up exercise.
As of FY23 end, SpiceJet’s net worth stood at negative Rs 3,232 crore as against negative Rs 4,288 crore recorded in FY22 end, according to its latest annual report.