Monday, August 07, 2017

Aviation players chart profit flight

Mumbai: A mix of soft fuel prices, moderate growth in supply and a healthy demand have buoyed the financials of aviation companies.

InterGlobe Aviation, the parent of India's largest carrier Indigo, has reported a strong 37 per cent growth in net profits for the first quarter ended June 30.

Net profits of the company came in at Rs 811 crore compared with Rs 592 crore in the same period of last year, on the back of a robust 28 per cent growth in passenger revenues.

According to credit rating agency Icra, the monthly passenger traffic reached an all-time high of 25.5 million in May - the start of the tourist season - registering a strong year-on-year growth of 16 per cent over May last year. The growth rate for cargo traffic stood at 17 per cent.
The passenger traffic trend in the industry was sustained in the following month when growth reached around 20 per cent levels, after staying below this mark for the previous four months.

Icra said there was moderation in capacity addition during the last few months. The growth in industry capacity (measured in available seat kilometres) in June was at 14 per cent because of below average capacity addition by Indigo, which has been facing delays in the deliveries of new aircraft.

In a presentation to analysts after the first quarter results, IndiGo which has been facing engine issues in the Airbus A320neo, said these were expected to be resolved by late 2018 or early 2019. The airline in the interim is working to secure additional spare engines to reduce disruptions. Reports said the airline had to ground nine Neos because of problems in the Pratt & Whitney engines.
06/08/17 Telegraph