Air India FY09 loss doubles on higher fuel prices, interest costs

New Delhi: Air India, the flag carrier run by National Aviation Co. of India Ltd (Nacil), said on Wednesday that its net loss had more than doubled to Rs5,548 crore in the year ended March, sinking deeper into the red because of higher fuel prices and interest costs on aircraft loans.
The airline, which two Air India officials said has decided to stop paying all performance-linked incentives to its top 36 directors, had posted a net loss of Rs2,226.16 crore in 2007-08. The airline released its financial results after a board meeting in Chennai.
Revenue fell to Rs13,479 crore in the fiscal gone by, from Rs15,252 crore, “due to global recession, fall in load factors and passenger yields”, Air India said in a statement. The number of passengers travelling on Air India flights fell to 10.36 million from 13.21 million in the previous year.
The cash-strapped and debt-burdened airline, which has sought Rs5,000 crore from the government in equity and loans, set its results against the backdrop of the global economic meltdown that resulted in fewer passengers travelling. The International Air Transport Association (Iata) forecast a combined loss of $16.8 billion (Rs78,288 crore) for the aviation industry in 2008 followed by a loss of $11 billion in 2009.
Air India, which cited increased depreciation costs and foreign exchange losses because of the rupee’s depreciation besides interest costs and fuel prices, said its performance would improve in 2009-10 as a result of increased passenger demand and cost-cutting measures, including withdrawal of loss-making routes and return of leased aircraft and wage cuts.
11/10/09 Tarun Shukla/Live Mint

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Categories: NACIL Nov 2009