Jet Airways profit soars, erasing loss

Mumbai: Jet Airways (India) Ltd, the country’s largest airline by passengers, posted its first profit in three quarters as it carried more travellers, cut costs and took advantage of cheaper aviation fuel and higher income from leasing planes.
It swung to a profit of Rs105.80 crore for the quarter ended 31 December, beating street estimates, from a loss of Rs214.18 crore. The last time profit crossed Rs100 crore was in the March quarter of 2006, although the carrier did breach the mark once in-between owing to a change in accounting policy to treat depreciation.
The earnings underscore the recovery in the country’s airline industry as carriers that posted a combined loss of $2 billion (Rs9,240 crore today) in fiscal 2009 and were expecting a similar loss this year, have been lifted by a resurgence in passengers amid signs of a strong recovery in the world’s fastest growing major economy after China.
“There was a strong recovery in operating margins. High seat occupancy, high yields and various cost initiatives led to a lower break-even seat factor,” said Jet Airways executive director Saroj K. Datta, who has been with the airline since its inception and has a total 48 years of industry experience. “We are cautiously optimistic about economic growth and its relative impact on the air travel market.”
Earnings at Jet Airways were aided by the Rs106.43 crore it earned from leasing its planes, up from Rs17.44 crore in the year before.
Encouraged by the results, Jet Airways rose 3.78% on the Bombay Stock Exchange on Monday to close at Rs539.20 as the exchange’s benchmark Sensex fell for a fifth day, losing 0.47%. In the past five trading sessions, the Sensex has shed 4.88% while Jet Airways has gained 6.36%.
With 29% passenger growth in the December quarter, Kingfisher Airlines Ltd made an operating profit of Rs11 crore for its domestic operations, although it posted a net loss of Rs419.96 crore.
Another listed company and low-fare carrier SpiceJet Ltd posted a record profit of Rs108.9 crore for the same quarter.
25/01/10 P. R. Sanjai/Live Mint

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Categories: Jet Airways Jan 2010