SpiceJet turns a profit in Q3 after seven loss-making quarters; shares soar
Low-cost carrier SpiceJet Ltd, India’s third-largest airline company by passengers carried, returned to profit in the third quarter of fiscal 2022 aided by a rebound in passenger traffic and growth in freight and logistics business.
After posting losses for seven quarters, SpiceJet posted a consolidated net profit of Rs 42.45 crore for the three months ended December 2021 against a loss of Rs 66.78 crore in the corresponding period last year.
For the three months ended September 2021, the Gurgaon-based company had posted a loss of Rs 57.05 crore.
The company reported a year-on-year growth of 35% in consolidated revenue from operations to Rs 2,204.67 crore in December 2021.
For the quarter ended December 2020 and September 2021, the airline reported revenue of Rs 1,635.79 crore and Rs 1,304.51 crore, respectively.
SpiceJet shares surged as much as 8.7% on the BSE after the company announced its earnings. The shares closed the day at Rs 64 apiece on the BSE on Tuesday, up 8% from the previous close. The stock has touched a high of Rs 91.60 and low of Rs 56.25 in the previous 52 weeks.
Other Key Highlights
1) Aviation turbine fuel (ATF) costs, which account for 35-50% of the cost to operate an airline in India, more than doubled to Rs 965.28 crore in December 2021 from Rs 453.87 crore in the corresponding period last year.
2) Aircraft lease rentals nearly doubled while airport charges and aircraft maintenance costs showed a marginal increase.
3) Revenue from air transport services grew 22% to Rs 1,681.4 crore in the quarter ended December 2021.
4) Freighter and logistics services revenue nearly doubled to Rs 583.76 crore from Rs 308.1 crore in December 2020.
SpiceJet Chairman and Managing Director Ajay Singh said the airline turned its path to profit driven by “excellent” logistics operations, a rebound in passenger traffic and various accommodations from aircraft manufacturers and lessors.
“The passenger industry witnessed the much-needed turnaround in the third quarter as Covid cases ebbed in the first half of the quarter, travel picked up significantly and there was finally hope that the worst was behind us,” Singh said.
“Our performance would have been much better but was impacted by the unexpected delay in the return to service of the 737 MAX, rising fuel costs and certain exceptional adjustments. I am happy to say that there are renewed signs of recovery in the passenger segment and the logistics segment continues to remain strong," Singh added.
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