New Delhi: India’s second-largest low-fare carrier SpiceJet Ltd, which has completed five years of operations, posted its first profitable annual profit, helped in part by moderate fuel prices and buoyant passenger demand.
SpiceJet declared an annual profit of Rs61.4 crore for the year to 31 March compared with a loss of Rs352.5 crore a year ago. For the March quarter, it made Rs27.5 crore in profit compared with a loss of Rs7.8 crore a year ago. Centrum Broking Pvt. Ltd had estimated quarterly profit at Rs17.9 crore.
“It turned out to be a good year for us,” chief executive officer Sanjay Aggarwal said, pointing to asset utilization and improved demand as key profit drivers. “I expect demand sentiment to continue this year.”
The carrier, with a 12.3% domestic passenger market share, plans to start international operations in mid-July, Aggarwal said. The airline, having completed the mandatory five years of domestic operations needed to fly overseas, already has approval to fly to three cities, including Dhaka and Kathmandu.
Profits were helped by cheaper fuel and more passengers. Fuel, which makes up 30-40% of an airline’s costs, was cheaper by as much as 33% year-on-year.
While its average passenger airfare of Rs3,210 for 2009-10 was lower than Rs3,613 in the 2008-09 fiscal, it notched up a load factor of 78% in 2009-10 compared with 66% in the previous one.
SpiceJet shares dropped 0.19% to close at Rs52.50 apiece in Mumbai on Monday even as the benchmark Sensex index closed up 0.15%.