Budget carrier SpiceJet has reported 43 per cent fall in net profit at INR 41.6 crore for the fourth quarter ended March 31, 2017 due to higher fuel cost and lower yield on account of demonetisation. The Gurugram-based carrier had reported a net profit of INR 73 crore during the January-March quarter of the 2015-16 fiscal. However, for the full fiscal 2016-17, the airline posted a net profit of INR 430 crore as compared to INR 407 crore reported in the fiscal year ended March 2016. SpiceJet reported a quarterly profit of INR 41.6 crore for the three months ended March 31, 2017, making it the ninth successive profitable quarter for the airline. The net profit for FY2017 stood at INR 430.7 crore, making this the second successive year of profitable growth. According to the airline, the operating revenues were at INR 1,625.7 crore for Q4 FY17 and INR 6191.3 crore for the fiscal 2017.
SpiceJet’s strong operational performance comes despite significant headwinds, the airline said adding that demonetisation resulted in significant decline in yield in Q3 and Q4. Increase in fuel cost was at 46 per cent in Q4 eroding approximately INR 160 crore of profit. These headwinds have subsided and SpiceJet is bullish about its future prospects, the airline said. “Two successive profitable years, a record aircraft order and emerging as India’s largest regional operator are testament of the fact that SpiceJet remains firmly on track on its long-term growth strategy,” said Ajay Singh, chairman and managing director, SpiceJet.
SpiceJet had in January this year announced that it will buy up to 205 new aircraft from Boeing for INR 150,000 crore, in one of the largest deals in the fast-growing Indian aviation sector. According to the airline, besides adding capacity on existing routes, it was awarded six proposals and 11 routes under the UDAN regional connectivity scheme.
With three-year exclusivity on the routes under the UDAN scheme, SpiceJet will be the only airline to operate on those sectors, the airline said. The airline is also set to benefit from the reduced cost on account of low jet fuel taxes and exemption from landing and parking charges at regional airports under UDAN. It also said that this summer the airline increased its regional capacity by 25 per cent and will further augment capacity in this segment.
