Tuesday, August 01, 2017

Strong passenger volume help Indigo boost June quarter performance

Strong passenger volumes, as well as better cost management, helped Interglobe Aviation, which operates its services under the Indigo brand, beat analysts’ estimates and post strong June quarter numbers. Higher demand reflected in the passenger load factors which were up 470 basis points (bps) to 88 per cent coupled with lower capacity addition growth helped boost operating revenues, which at Rs 5,752 crore were up nearly 26 per cent over the previous quarter. The company had to ground some of its aircraft in the quarter, given issues with the engines in the new A320neos, which impacted capacity. The company indicated that engine issues will be sorted out over the next one year and it will receive compensation from Pratt and Whitney for the same though it did not reveal the amount or the timeline of the same. The company improved its margins at the Ebitda level (operating profit before rentals) by 20 bps to 34.1 per cent. Driven by a better top-line performance and higher other income, the company reported a 37 per cent increase in net profit to Rs 811 crore. This was higher than Bloomberg consensus estimates of Rs 730 crore. Other income increased by 25 per cent to Rs 202 crore.
01/08/17 Ram Prasad Sahu/Business Standard