Wednesday, August 15, 2018

Government working on issues hurting aviation sector: Suresh Prabhu

The civil aviation ministry has taken cognisance of the stress in the aviation sector due to rising fuel prices and the depreciating rupee. Minister Suresh Prabhu Tuesday said that the ministry was working on addressing these issues. While flag-carrier Air India delayed payment of salaries to its employees for the fifth consecutive month before disbursing them on Tuesday, private airlines have seen a significant drop in yields.

“All these issues are also addressed by the ministry through various means and therefore this issue has also been taken into account. As you know, due to increase in fuel costs, airline sector not just in India but globally is facing serious challenges. All the airlines are suffering because their cost has suddenly gone up after a long lull in oil prices,” Prabhu said, while briefing journalists on the civil aviation ministry’s proposed plan for greenfield airport agreements.

Tuesday, budget airline SpiceJet reported its earnings for the June-quarter recording a net loss of Rs 38 crore, after 13 consecutive quarters of profitability. For the same period last year, SpiceJet recorded a net profit of Rs 175.2 crore. The airline attributed its loss to a one-time expense of Rs 63.5 crore of an arbitration award that cited interest payable of Rs 92.5 crore and interest receivable of Rs 29 crore for SpiceJet. “While the industry has been plagued with adverse macroeconomic conditions in the form of rising crude oil prices and weakening rupee, SpiceJet was able to demonstrate a superior revenue performance to overcome this drag and has been able to generate positive cash flow,” SpiceJet pointed out in its investor presentation. However, the airline saw its EBITDA (earnings before interest, taxes, depreciation and amortisation) margin fall to 5 per cent for quarter-ended June, compared with 13 per cent last year.
15/08/18 Indian Express
To Read the News in full at Source, Click the Headline


Post a Comment