August 14, 2018 / 9:31 AM / 3 months ago

SpiceJet posts quarterly loss on fuel expense, forex loss

(Reuters) - Low-cost carrier SpiceJet Ltd reported a loss for the first quarter on Tuesday, partly hurt by higher fuel expenses and foreign exchanges losses.

A SpiceJet Boeing 737-800 passenger aircraft prepares to land at Sardar Vallabhbhai Patel international airport in Ahmedabad, May 19, 2016. REUTERS/Amit Dave/Files

The airline also set aside 634.7 million rupees ($9.08 million) for the payment of an arbitration award in relation to its legal proceedings against erstwhile promoters KAL Airways Pvt Ltd and Kalanithi Maran.

Fuel costs rose 52 percent from a year earlier to 8.12 billion rupees, while total expenses increased 31.2 percent to 22.45 billion rupees.

SpiceJet incurred a forex loss of 510 million rupees as the rupee depreciated.

India is the world’s fastest-growing aviation market, but rising fuel prices, a weaker rupee and airfare wars are hurting carriers.

India is also one of the cheapest airline markets, but carriers have struggled to stay profitable even though the number of domestic passengers has more than doubled over the last four years.

SpiceJet said bit.ly/2P40ILg it had significantly improved its liquidity position over the last three years, and that it would be able to maintain profitable operations and raise funds as needed.

Earlier this week, Jet Airways (India) Ltd said it is considering various options on priority to meet its funding requirements, shortly after it deferred its quarterly earnings report.

SpiceJet’s standalone net loss, which excludes results of units SpiceJet Merchandise and SpiceJet Technic, was 380.6 million rupees in the June quarter.

The company had reported a profit of 1.75 billion rupees in the year-ago period.

Total income from operations rose 19.6 percent to 22.36 billion rupees.

($1 = 69.9175 Indian rupees)

Reporting by Abinaya Vijayaraghavan in Bengaluru; Editing by Sunil Nair and Subhranshu Sahu

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