Jan 20, 2012
Private carrier Jet Airways on Friday said it registered a net loss of Rs 101.22 crore for the quarter ended December 31, 2011, in sharp contrast to a net profit of Rs 118.23 crore in the same quarter last fiscal, due to higher ATF costs and rupee depreciation.
"High fuel prices together with the depreciating Indian rupee versus US dollar have pulled down the operating results to an extent. However, yield improvements due to seasonality and the narrowing gap between demand-supply imbalances have helped the airlines to post operating profits," Jet Airways (India) Ltd CEO Nikos Kardassis said.
He said the airline would continue to remain competitive through innovative marketing initiatives, an increase in ancillary revenues, an enduring focus on cost-cutting measures through contract renegotiation and process improvements across all segments of the business.
"Weakening of the Indian rupee vis-a-vis the US dollar has had an impact on US dollar-related costs, including for aviation turbine fuel (ATF), because the same is priced in US dollars," an official statement said.
"Though we have a natural hedge in terms of our US dollar earnings to a big extent, we are still impacted because of the same and this is largely uncontrollable in the short-term. Consequently, many of the cost line items have a currency impact embedded in it," it said.
The statement said that ATF prices and rupee depreciation would continue to be a cause of concern in the short-term. Furthermore, though Q4 passenger bookings show encouraging trends, these are expected to reflect some seasonality.
"We continue to see a steady increase in our corporate and business class bookings over the last few weeks, given what has been happening in the industry and with competition. We do not see any major slowdown in our international bookings into or out of Europe and North America," the statement said.
The airline expects the Indian domestic market to continue growing at 12 per cent to 15 per cent in the short to medium-term.
The capacity induction in the market has slowed down, giving considerable scope to airlines to push for higher yields, and the airline saw some semblance of this from November, 2011, the statement said.
The airline said its international operations continue to achieve seat factor of around 80 per cent even in the troubled financial environment in the West.
The airline also hopes to complete the transition from Jetlite to Jet Konnect during this quarter, which will enable it to consolidate its market leadership position with two strong brands.
Its fund-raising initiatives are well on track and it has realised monies from the Bandra-Kurla Complex deal, as well as through the sale and lease back of engines in Q3, the statement said.
"We expect to complete the sale and lease back of some of our B-737 aircraft during the fourth quarter, which will not only help us pay off high cost rupee debt, but also in paying off some working capital loans from the surplus cash that we will generate," the statement said.
PTI
Mumbai
