InterGlobe Aviation reports bigger-than-expected Q2 losses

InterGlobe Aviation, the company that operates Indigo Airlines, reported a bigger-than-expected net loss for the second quarter as fuel costs zoomed 84%.

Net loss came in at Rs 652.1 cr for the quarter ended September 2018 compared to a net profit of Rs 552 cr last year.

The “higher fuel prices [were] responsible for more than half of the profitability decline,” it said.

The remainder of the decline was due to currency depreciation and lower yields, it said.

Revenue from operations increased 17% on year to 6,185 cr, while total expenses jumped 58% to 7,502 cr.

Out of the 7,502 cr expenses, fuel costs accounted for Rs 3,036 cr, compared to just Rs 1,647 cr last year.

Aircraft and engine rentals too increased by 36% to 1,116 cr, partly due to more number of aircraft, but also because of a decline in the value of the rupee against foreign currencies like the US dollar.

Another item that saw a sharp increase was ‘other expenses’, which jumped 35% on year to Rs 1,898 cr.

The company added 5 new destinations and 35 new routes during the quarter.

The company reported a 29% jump in total capacity, and said it expects available seat kilometers to rise 35% in the current quarter.

However, for the year as a whole, the increase will be around 30% only, it added.

It said total cash was Rs 13,164 cr, including free cash of Rs 4,418 cr.