The grounding of Jet AirwaysNSE 4.92 % has helped the aviation industry improve its financials with SpiceJet reporting highest-ever net profit of Rs 261.7 crore during the first quarter of the current fiscal against a loss of Rs 38.1 crore during the same period last year.
The airline said that the its total income rose to Rs 3,145.3 crore for the quarter ending June 2019 as against Rs 2,253.3 crore for the corresponding quarter last year.
The company said that the operating revenues were at Rs 3,002.1 crore against Rs 2,220.4 crore for the corresponding quarter last year. On an EBITDA basis, profit is at Rs 747.5 crore as against Rs 100.5 crore for the corresponding quarter last year. Operating expenses were at Rs 2,883.6 crore as against Rs 2,227.9 crore for the corresponding period last year.
The airline also said that the best-ever performance is despite the fact that the airline has now moved to new accounting standards that impacts financial numbers.
“Effective April 1, 2019, the airline adopted the new accounting standard IND AS 116 which effectively capitalised operating leases, and as a result of this lease rentals are now reflected as interest and depreciation for the quarter ending June 2019. Additionally, owing to the retrospective treatment of this standard there is a reduction of Rs 302.2 crore from retained earnings status as at April 1, 2019,” said the firm.
The airline credits these numbers to its ability to bring in capacity, impacted due to grounding of Boeing 737 MAX, by adding Jet Airways’s planes.
“SpiceJet has been on a spectacular growth journey and this quarter, in particular, has been very special for us. We added 32 aircraft to our fleet expanding at a pace unprecedented for a sector plagued by crisis showcasing our robust business model and proven operational capabilities. We are happy that we were able to minimise passenger inconvenience by quickly filling the capacity gap created in India’s aviation sector. The results would have been vastly better but for the painful grounding of the MAX aircraft. We look forward to their swift return to service in the near future that will help SpiceJet increase its margins and provide a superior level of service.” Ajay Singh, Chairman and Managing Director, SpiceJet, was quoted in the release.