SpiceJet to announce Q1FY25 results on time after a year. Here is what to expect

SpiceJet, once a soaring carrier and now a shadow of its former self, will declare its Q1FY25 results on August 14, 2024. The most surprising thing about the results is that they are being declared on time. The results for Q2, Q3 and Q4 for last year were delayed with the last two quarters and full-year reporting being clubbed and declared in July. It is after a year that SpiceJet is scheduled to declare its results on time.

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The airline had reported a profit of ₹197.64 crore in Q1FY24, while it closed FY24 with a loss of ₹409 crore, compared to IndiGo’s bumper profit of ₹8,170 crore. At one point in time, IndiGo and SpiceJet were neck and neck.

The result declaration comes amidst a time when Mumbai airport had put out a post on social media indicating disruption of SpiceJet flights starting August 13. The post was subsequently taken down and the airline informed that it had resolved “minor financial issues”. There continue to be delay in salary payments along with statutory dues to the government.

Shrinking airline

In Q1FY25, SpiceJet carried 16.71 lakh domestic passengers across 12,038 domestic flights. Compared to the same period last year, the airline operated 15 per cent fewer flights and ferried 17 per cent fewer passengers. Capacity by ASK (Available Seat Kilometre) was down 18 per cent. The international operations have held on, understandably so since they offer the much-needed foreign exchange. International departures were down only 6.5 per cent, while traffic held on to last year's numbers.

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In June, the airline flew only 4.99 lakh domestic passengers with a market share of 3.8 per cent. At its worst in December 2014, when SpiceJet had to stop operations for a few hours, it had 10.4 per cent market share and carried 6.71 lakh domestic passengers. This was in a market which was half of what it is today. The industry carried 64.4 lakh domestic passengers in December 2014, while in June this year, there were 1.32 crore (132 lakh) domestic passengers which is double the number.

According to data provided by Cirium, an aviation analytics company, exclusively for this article, SpiceJet has nearly vacated the metro routes, considered the bread winners for most airlines. There also remain a lot of flights which are scheduled to be on sale as per the Cirium data, but the actual flights operated are fewer than this number, indicating cancellations or inability to operate the flights. For August, the airline has 882 weekly flights on sale. Delhi remains its largest hub with 214 weekly flights, while Mumbai - the second largest airport in the country - comes in third at a mere 64 weekly departures. Interestingly, Dubai has more SpiceJet departures than Mumbai. As per its schedule with Cirium, it is operating to 35 destinations. While airlines are rushing to add capacity to Bengaluru, it has just two departures a day and its once stronghold, Chennai, is nearly gone off airmap for SpiceJet. The leased A340, which was deployed to Bangkok from Delhi, has left the fleet and its foray to Phuket was quickly shut.

The fleet situation isn’t ideal either. From its last tranche of funding and settlement with lessors, it wanted to add planes to its fleet but flight tracking website FlightRadar24 shows six out of seven MAX 8 aircraft being grounded, while a larger number of Q400s being off the radar and a handful operational. It continues to maintain a fleet of over 20 operational planes, which are needed to continue operations on international routes. The subsidiary SpiceXpress, which was hived off, is without any active planes, though the cargo division continues to operate and bring business under this company.

What to expect in the results?

The airline desperately needs cash and the board has already approved raising ₹3,000 crore. The bigger question is how and when it will be raised. The auditors, like in the past, will continue to add remarks about the challenges for the airline to continue as a going concern. IndiGo’s profits for Q1 were ₹2,729 crore, which included compensation from Pratt & Whitney. Reporting an operational profit for SpiceJet will be a big boost and could help with raising cash.

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The real challenge, though, is to get the airline back to flying its grounded planes and tide over what looks like a never-ending crisis. It could well be headed towards a now-or-never moment.