Focus on cost reduction amid competition: Jet Airways
Jet Airways, which has posted a record quarterly net profit of Rs 467 crore, today said it would focus on cost reduction amid pressure from competitive and structural changes in the domestic aviation sector.
New Delhi: Jet Airways, which has posted a record quarterly net profit of Rs 467 crore, today said it would focus on cost reduction amid pressure from competitive and structural changes in the domestic aviation sector.
The leading private airline would also be looking at further improving its aircraft utilisation as well as leveraging commercial and operational synergies with UAE's national carrier Etihad, according to senior officials.
In the three months ended December 2015, Jet Airways posted a "record" net profit of Rs 467 crore on the back of higher passenger traffic and lower fuel costs.
"The competitive and structural changes in the Indian aviation market continues to put pressure... We continue to focus on cost reduction, leverage commercial and operational synergies (with Etihad)," Jet Airways CFO Amit Agarwal said.
Without providing specifics, he said the carrier would look at every single possibility to reduce cost.
The airline's total debt stood at Rs 11,384 crore at the end of December 2015. The amount includes aircraft debt worth Rs 4,666 crore.
With regard to falling fuel prices and resultant ticket pricing, Jet Airways CEO Cramer Ball said there would be "increasing pressure on domestic and international yields".
Discussing the latest quarterly results with analysts on a conference call, Agarwal said the carrier repaid Rs 860 crore debt in the December quarter. In the first nine months of this financial year, it repaid debt to the tune of over Rs 2,400 crore.
Referring to the record profit reported in the third quarter of this fiscal, Ball said the airline's turnaround plan is certainly working faster than anticipated.
The turnaround plan was unveiled after it sold 24 percent equity to the Etihad in April 2013 for around Rs 2,058 crore.
Ball, who has put in his papers, also noted that there is more headroom for improving utilisation of aircraft.
On February 6, Jet Airways reported a record stand-alone quarterly profit of Rs 467 crore in the three months ended December, compared to Rs 63 crore posted during the same period an year ago.
In the latest December quarter, Jet Airways' revenue rose by Rs 266 crore to Rs 5,702 crore, while passenger revenue climbed 4.8 percent to Rs 4,845 crore.
Another income of Rs 192 crore as well as decline in finance cost to Rs 214 crore from Rs 226 crore in the year-ago period also boosted the bottom line, the airline said.