Jet Airways, which is expected to finalise a stake sale to Abu Dhabi’s Etihad Airways, swung back to a profitable path on Friday due to rising air fares and lower expenses.
The airline posted a net profit of Rs 85 crore for the quarter ended December 31, 2012, against a net loss of Rs 101 crore in the corresponding period last year.
Total income from operations rose nearly seven per cent to Rs 4,206 crore in the third quarter, from Rs 3,939 crore in the year-ago period.
Lower fuel cost
Aviation fuel cost fell three per cent to Rs 1,688 crore on a year-on-year basis, while gross yields per passenger grew 18.6 per cent for the third quarter of this fiscal.
However, aircraft lease rentals went up in the third quarter to Rs 306 crore from Rs 246 crore in the corresponding previous period.
“The combined impact of higher yields and lower costs has resulted in significantly lowering the breakeven seat factor levels in the business. This is despite the slowdown in traffic growth, higher fuel prices and impact of a weak rupee against the US dollar,” Nikos Kardassis, Chief Executive Officer, Jet Airways said.
The company has, over the last few months, pulled out of loss-making routes and redeployed aircraft to other profitable routes, Jet Airways added.
The company said it has stopped capacity on loss-making routes and will re-deploy the seats on profitable, high-density routes in the coming months.
Currently, aircraft on the ground have impacted the topline by Rs 55 crore.
Indian airline companies are struggling under massive debt because of high taxes on fuel and steep airport charges.
Cost-cutting
“We continue in our endeavour on cost-cutting measures, exploring various avenues of ancillary revenues and process improvements across all segments of the business, which will help us improve the business further,” Kardassis said.
The shares of Jet Airways closed at Rs 622.65, up 0.09 per cent, on the BSE on Friday.