SpiceJet Q2 loss widens to Rs 463 crore on higher costs

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New Delhi | Published: November 14, 2019 4:13:46 AM

Losses at SpiceJet widened to Rs. 463 crore for the quarter ended September 2019, impacted by higher costs and a seasonally weak quarter, the company said on Wednesday.

SpiceJet has so far inducted 31 aircraft belonging to Jet Airways which closed on April 17.

Losses at SpiceJet widened to Rs. 463 crore for the quarter ended September 2019, impacted by higher costs and a seasonally weak quarter, the company said on Wednesday.

SpiceJet’s losses were higher than street expectations; analysts tracked by Bloomberg had estimated a Rs. 328-crore loss for the budget carrier in Q2FY20.

The company had reported a loss of Rs. 389 crore in Q2FY19 over high fuel costs, rupee depreciation and intense competition leading to low fares.

For the second consecutive quarter, SpiceJet has factored in reimbursements of around Rs. 176 crore from Boeing for its 13 B737 Max aircraft in Q2FY20, resulting in curtailed losses.

The carrier’s operating revenues were up 52% year-on-year (y-o-y) to Rs. 2,845 crore on higher passenger count and better passenger yield. The yield was up by Rs. 3.54/km in Q2FY19, around 2% y-o-y as the airline ramped up international capacities.

SpiceJet has so far inducted 31 aircraft belonging to Jet Airways which closed on April 17.

The operating margins or the Ebitda (earnings before interest, tax, depreciation, amortisation and rentals) was down to -1.9% in Q2FY20 from 2.6% exactly a
year ago.

While the aviation turbine fuel bill went up 38% y-o-y to Rs. 1,162 crore, the depreciation and amortisation costs surged more than five times to Rs. 436 crore. Its aircraft maintenance charges shot up 45% y-o-y to Rs. 518 crore. The airline also incurred a forex loss of Rs. 193 crore in Q2FY20, up 230% y-o-y.

Kiran Koteshwar, chief financial officer, SpiceJet said the airline was hit by various costs and losses with respect to Max fleet.

“It was a well-contained quarter for us. There were inflated costs such as operating lesser seats on Jet planes and weak travel season. We have so far re-configured business seats on 21 ex-Jet aircraft into economy ones,” Koteshwar said.

According to the analysts, average domestic fares were up 7-8% y-o-y during Q2FY20. IndiGo, which had a fleet of 113 aircraft at the end of September 2019, connected Mumbai and Delhi with cities like Hong Kong, Riyadh, Jeddah and Dhaka during Q2FY19.

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