Jet Airways Q4 loss doubles on rising fuel costs

Mumbai, May 24:  

Jet Airways more than doubled its losses at Rs 298 crore in the fourth quarter of the financial year 2012 compared with the year-ago period.  Despite a 24 per cent growth in revenues, rising fuel costs and a weak rupee pushed the company deeper into red.

For the full year, losses were Rs 1,255 crore against profits of Rs 46 crore in the previous fiscal. Fuel costs were up 52 per cent at Rs 663 crore for the full fiscal.

 The Jet Group (Jet Airways and Jetlite) has reported a 24 per cent increase in total revenue of Rs 4,638 crore in the fourth quarter of FY 2012. Operating profits were at Rs 412 crore, while operating margins were at nine per cent. For the full year, revenues were at Rs 16,898 crore, up 15 per cent, while operating profits were at Rs 1,168 crore.

In a press statement issued by the company, Mr Nikos Kardassis, Chief Executive Officer, Jet Airways (I) Ltd said: “Rupee depreciation and fuel prices have impacted the quarterly results.”

In its outlook, the company said, “Capacity reduction in the industry has helped the domestic airlines to increase fares and improve yields. The full impact of the same would be felt in the current quarter.

“We have not seen any adverse effect on the passenger traffic flow. Rupee depreciation and crude oil prices continue to be a cause of concern. This coupled with sluggish economy could impact traffic growth to some extent in the short to medium term as the discretionary spending on travel could get affected.”

On the company's strategy going forward, the company statement said: “We have taken various initiatives to improve our operating efficiency and revenue earning potential. JetKonnect rebranding initiative will help us to enhance revenues.

“Other initiatives such as enhancing ancillary revenues, discontinuing loss making routes, sale of aircraft, restructuring commissions being paid to the agents will also help us in medium to long term.”

“Our International business continues to be robust and we are achieving healthy seat factors. We are focusing on network rationalisation, selectively adding flights to profit making markets such as Gulf & West Asia and Asean routes and discontinuation of loss making routes,” added the statement.

The Jet Air Group claimed its market share in the fourth quarter ended March 31, 2012, stood at 29.3 per cent.

The company scrip closed at Rs 321.20 on the BSE on Thursday, down 0.23 per cent from its previous close.

http://www.thehindubusinessline.com/todays-paper/tp-corporate/article3453485.ece