SpiceJet net down 13% on high fuel costs
Just when it looked like airlines were flying out of the turbulence zone, budget airline SpiceJet sprung a negative surprise on Thursday by reporting a 13.3% dip in its net profit in the quarter ended December 31 at Rs94.45 crore against Rs108.94 crore in the same period last year.
Analysts said the decline in the net was on account of higher fuel costs and flat yield.
“While we had factored in higher fuel costs, the stagnant yield has come as a negative surprise because December quarter, which is a strongest quarter in a year, always has a higher yield than September quarter,” said an analyst with a domestic broking house, who did not want to be named.
He said the yield derived on the basis of revenue per passenger kilometre (RPKM) in the third quarter was Rs3.45 compared with Rs3.46 in the second quarter.
In fiscal 2010, the yield in the third quarter had moved up to Rs3.50 per RPKM from Rs2.76 in the previous quarter. Ankur Bhatia, executive director of travel conglomerate Bird Group, said it was difficult to pinpoint a reason for the flat yields.
Analysts said the decline in the net was on account of higher fuel costs and flat yield.
“While we had factored in higher fuel costs, the stagnant yield has come as a negative surprise because December quarter, which is a strongest quarter in a year, always has a higher yield than September quarter,” said an analyst with a domestic broking house, who did not want to be named.
He said the yield derived on the basis of revenue per passenger kilometre (RPKM) in the third quarter was Rs3.45 compared with Rs3.46 in the second quarter.
In fiscal 2010, the yield in the third quarter had moved up to Rs3.50 per RPKM from Rs2.76 in the previous quarter. Ankur Bhatia, executive director of travel conglomerate Bird Group, said it was difficult to pinpoint a reason for the flat yields.
SpiceJet to Boost Capacity 40% This Year After Maran Investment
SpiceJet Ltd., the Indian discount carrier, plans to boost capacity about 40 percent this year after winning investment from billionaire Kalanithi Maran.
The airline will focus expansion on domestic routes and may add one or two international destinations, Chief Commercial Officer Samyukth Sridharan said today in an interview in Singapore. The carrier will boost its fleet to 40 planes this year from 25 now and almost double it by 2013, he said.
The airline earlier today fell the most in a month in Mumbai trading after reporting a decline in quarterly profit because of higher fuel costs. Passenger numbers in the three months ended December surged 33 percent as rising wages boosted travel and the carrier added its first overseas flights.
The airline will receive 15 Bombardier Inc. Q400 turboprops in the 13 months beginning June, Sridharan said. It will also add seven Boeing Co. planes this year, he said. The airline ordered 30 Boeing 737s and 30 Q400s last year. There “are good signs” that the market can continue growing at rate of about 18 percent in terms of passenger numbers, Sridharan said.
SpiceJet declares a profit of Rs 94 cr during Q3FY11
The airline will focus expansion on domestic routes and may add one or two international destinations, Chief Commercial Officer Samyukth Sridharan said today in an interview in Singapore. The carrier will boost its fleet to 40 planes this year from 25 now and almost double it by 2013, he said.
The airline earlier today fell the most in a month in Mumbai trading after reporting a decline in quarterly profit because of higher fuel costs. Passenger numbers in the three months ended December surged 33 percent as rising wages boosted travel and the carrier added its first overseas flights.
The airline will receive 15 Bombardier Inc. Q400 turboprops in the 13 months beginning June, Sridharan said. It will also add seven Boeing Co. planes this year, he said. The airline ordered 30 Boeing 737s and 30 Q400s last year. There “are good signs” that the market can continue growing at rate of about 18 percent in terms of passenger numbers, Sridharan said.
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| KALANITHI MARAN-CHAIRMAN |
SpiceJet, India’s only profitable listed airline, continues its successful record with yet another quarter in the black. The airline reports a net profit of 94.4 crores for the quarter ended December 2010 with a 10% improvement in EBITDA to 114 crores over the same period previous year. With this result, SpiceJet has now declared a profit for the last 5 successive quarters. Reflecting the robust growth in domestic passenger traffic, SpiceJet had their highest quarterly load factors of 87.8% during this period and closed with an all-time high market-share of 13.6% for the quarter against load factor of 80% and a market-share of 12.5% for the same quarter last year.
Neil Mills, Chief Executive Officer, said “In a sense, this has been a very crucial quarter for us. During these three months we have firmed up our future expansion plans with our fresh aircraft orders and have been preparing the ground for the rapid expansion planned over the next 3 years. In the backdrop of this, we are happy to have posted our highest quarterly load factor of 87.8% during this quarter. This clearly demonstrates the increasing consumer acceptance of the SpiceJet value-service offering. We are also pleased that the yields in the market remained stable despite an increase of 11% in the market domestic seat capacity.”
Kalanithi Maran raises stake in SpiceJet to 31%Neil Mills, Chief Executive Officer, said “In a sense, this has been a very crucial quarter for us. During these three months we have firmed up our future expansion plans with our fresh aircraft orders and have been preparing the ground for the rapid expansion planned over the next 3 years. In the backdrop of this, we are happy to have posted our highest quarterly load factor of 87.8% during this quarter. This clearly demonstrates the increasing consumer acceptance of the SpiceJet value-service offering. We are also pleased that the yields in the market remained stable despite an increase of 11% in the market domestic seat capacity.”
Sun TV founder Kalanithi Maran and his unlisted aviation firm, Kal Airways Pvt Ltd , have raised stake in low-cost carrier SpiceJet by acquiring an additional 19.37 million shares, or 4.78 percent, the airline said in a filing to the BSE on Wednesday.
The shares were acquired on Oct 26 through an off-market transaction and Maran's direct holding in SpiceJet now stands at 30.98 percent.
Safety violation: SpiceJet sacks four senior officials
Low-cost carrier SpiceJet Ltd has fired four senior executives after receiving a notice from the aviation regulator for listing children as infants to accommodate more passengers, a violation of safety norms.
The airline deployed a 189-seat Boeing Co. 737-800 aircraft for the Delhi-Mumbai flight SG-103 on 2 June instead of the scheduled 212-seat B737-900, because of a delay.
After 15 passengers protested for being asked to deplane because of a shortage of seats, SpiceJet officials asked children to sit on the laps of the adults they were travelling with—even though safety norms prescribe that anyone above the age of 2 must be given a separate seat.
Mint reported on 21 June that passengers had complained against the airline. The Directorate General of Civil Aviation (DGCA) then said it would investigate the incident. Late last month, the regulator issued a show-cause notice to SpiceJet after concluding that safety norms had been breached.
A senior SpiceJet official official said four senior executives had been asked to leave, including the head of airports, and head of customer services. “We have also asked all station managers of airports to put passengers on a different flight in such a situation. The matter has been take very seriously.”
The airline has also sent its reply to DGCA’s notice, the official added.
After 15 passengers protested for being asked to deplane because of a shortage of seats, SpiceJet officials asked children to sit on the laps of the adults they were travelling with—even though safety norms prescribe that anyone above the age of 2 must be given a separate seat.
Mint reported on 21 June that passengers had complained against the airline. The Directorate General of Civil Aviation (DGCA) then said it would investigate the incident. Late last month, the regulator issued a show-cause notice to SpiceJet after concluding that safety norms had been breached.
A senior SpiceJet official official said four senior executives had been asked to leave, including the head of airports, and head of customer services. “We have also asked all station managers of airports to put passengers on a different flight in such a situation. The matter has been take very seriously.”
The airline has also sent its reply to DGCA’s notice, the official added.
Maran launches SpiceJet open offer
Delhi-based low-cost carrier SpiceJet’s new promoters SunTV chief Kalanithi Maran and his company KAL Airways has launched an open offer to acquire an additional 20% stake in the low-cost carrier on October 18. The offer will open on October 18 and close on November 6, said a filing on the Bombay Stock Exchange dated October 13.
In June, the Chennai-based industrialist had clinched a deal to acquire a 37.7% stake in the low-cost carrier for Rs 739.57 crore from American investor Wilbur Ross, his investment companies and the Kansagara family-promoted Royal Holding Services.
Recently, Maran increased his stake in the budget airline to 25.12% by acquiring 7.42% additional stake through off-market transactions.
In June, the Chennai-based industrialist had clinched a deal to acquire a 37.7% stake in the low-cost carrier for Rs 739.57 crore from American investor Wilbur Ross, his investment companies and the Kansagara family-promoted Royal Holding Services.
Recently, Maran increased his stake in the budget airline to 25.12% by acquiring 7.42% additional stake through off-market transactions.
India’s low-fare carrier enters Sri Lankan airspace
India’s low cost carrier Spice Jet entered the Sri Lankan airspace last week with Colombo being its second international destination. Spice Jet will operate daily flights to India, arriving in Colombo at night and an early morning departure to Chennai. The airline recently launched flights to Kathmandu.
Speaking to the Business Times on why Colombo was added to the network, Spice Jet Promoter and Director B. S. Kansagra said there is a lot of demand in India now for flights to Sri Lanka. He said Spice Jet offers the best fares across the board, and has now decided to extend this opportunity to the Sri Lankans who wish to visit India.
“Colombo is known as a good shopping destination. Here the fabrics are very competitively priced compared to India. There are also a lot of other attractions here in Sri Lanka. Tourists from both our countries can benefit especially from the special low cost fares offered by Spice Jet,” he said.
Commenting further of the future plans of expansion, Mr Kansagra said, “depending on the numbers we will be looking at another flight out of Colombo and hopping flights (two destinations in one package) by the end of the first quarter 2011. We are also looking at having direct flights to other Indian cities. We are looking at an average 80 % load per flight on this route.”
SpiceJet appoints Neil Mills as CEO
Speaking to the Business Times on why Colombo was added to the network, Spice Jet Promoter and Director B. S. Kansagra said there is a lot of demand in India now for flights to Sri Lanka. He said Spice Jet offers the best fares across the board, and has now decided to extend this opportunity to the Sri Lankans who wish to visit India.
“Colombo is known as a good shopping destination. Here the fabrics are very competitively priced compared to India. There are also a lot of other attractions here in Sri Lanka. Tourists from both our countries can benefit especially from the special low cost fares offered by Spice Jet,” he said.
Commenting further of the future plans of expansion, Mr Kansagra said, “depending on the numbers we will be looking at another flight out of Colombo and hopping flights (two destinations in one package) by the end of the first quarter 2011. We are also looking at having direct flights to other Indian cities. We are looking at an average 80 % load per flight on this route.”
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| NOW FLYING COLOMBO AND KATHMANDU |
Revamping its management team, leading low-cost carrier SpiceJet today said it has appointed Neil Raymond Mills as Chief Executive Officer.
"This is to inform that Neil Raymond Mills has joined SpiceJet as its CEO effective from October 11, 2010," the airline said in a filing to the Bombay Stock Exchange.
Prior to joining SpiceJet, Neil Mills was Chief Financial Officer (CFO) of Dubai government-owned carrier (LCC) FlyDubai, the filing added.He had also worked with one of Europe's most successful low-cost airline, EasyJet, and has expertise in the budget airline sector.
Appointment of Mills as CEO is part of revamp exercise of the airline by its new promoter and media magnet Kalanithi Maran, who in June had clinched a deal to acquire 37.7 per cent stake in the low-cost carrier for about Rs 750 crore.
Within two months of Chennai-based industrialist clinching the deal, several top officials including the then CEO Sanjay Aggarwal and founder director Ajay Singh, left the organisation, giving a free hand to the new stakeholder to revamp the management.
"This is to inform that Neil Raymond Mills has joined SpiceJet as its CEO effective from October 11, 2010," the airline said in a filing to the Bombay Stock Exchange.
Prior to joining SpiceJet, Neil Mills was Chief Financial Officer (CFO) of Dubai government-owned carrier (LCC) FlyDubai, the filing added.He had also worked with one of Europe's most successful low-cost airline, EasyJet, and has expertise in the budget airline sector.
Appointment of Mills as CEO is part of revamp exercise of the airline by its new promoter and media magnet Kalanithi Maran, who in June had clinched a deal to acquire 37.7 per cent stake in the low-cost carrier for about Rs 750 crore.
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| NIEL MILLS-CEO |
SpiceJet aims for international operations break even in 2 months
Low-fare airline SpiceJet is looking at over 80% load factor (which means more than 8 out of 10 seats on the flight being full) within the first month of commencing daily flights between Delhi-Kathmandu and a breakeven of international operations within the first two months.
The airline’s first international flight, between Delhi and Kathmandu, took off on October 7 and the daily Mumbai leg is slated to begin in March.
SpiceJet’s optimism on load factors is remarkable, since there are already seven flights a day between the Capital and Kathmandu by carriers such as Jet Airways, JetLite, Air India, Kingfisher and Nepal Airlines. Chief Commercial Officer Samyukth Sridharan claimed in a chat with DNA that SpiceJet will be offering the lowest fares on this sector.
Sridharan explained that SAARC is a hugely underserved market, particularly by low fare airlines. While domestically, 7 out of 10 fliers board low fare carriers, only three in 10 do so on international routes because of the absence of low fare options.
Low-cost airlines on time in South
The airline’s first international flight, between Delhi and Kathmandu, took off on October 7 and the daily Mumbai leg is slated to begin in March.
SpiceJet’s optimism on load factors is remarkable, since there are already seven flights a day between the Capital and Kathmandu by carriers such as Jet Airways, JetLite, Air India, Kingfisher and Nepal Airlines. Chief Commercial Officer Samyukth Sridharan claimed in a chat with DNA that SpiceJet will be offering the lowest fares on this sector.
Sridharan explained that SAARC is a hugely underserved market, particularly by low fare airlines. While domestically, 7 out of 10 fliers board low fare carriers, only three in 10 do so on international routes because of the absence of low fare options.
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| SPICEJET NOW INTERNATIONAL |
Low-cost airlines on time in South
Low-cost airlines seem to be on time in the southern skies. Key low-cost airline players such as SpiceJet and IndiGo have given their best on-time perfomance (OTP) in the South.
IndiGo recorded an on-time performance of 90.63%, the highest among all flights that were operated from Chennai in September. The on-time performance of SpiceJet stood at 90%, its best ever.
Significantly, Kalanithi Maran-promoted SpiceJet, which recently started its Madurai service, is focusing on southern expansion plans, primarily holding on its multiple frequency approach.
SpiceJet chief commercial officer Samyukth Sridharan said, “On-time performance has always been the key area which help the carrier to have maximum load factor. We have recorded 84% OTP in August and 90% in September despite infrastructure constraints.”
The Airport Authority of India, in association with Directorate General of Civil Aviation (DGCA), has monitored the OTP of domestic carriers operating from Chennai from August 28- September 22, 2010.
IndiGo recorded an on-time performance of 90.63%, the highest among all flights that were operated from Chennai in September. The on-time performance of SpiceJet stood at 90%, its best ever.
Significantly, Kalanithi Maran-promoted SpiceJet, which recently started its Madurai service, is focusing on southern expansion plans, primarily holding on its multiple frequency approach.
SpiceJet chief commercial officer Samyukth Sridharan said, “On-time performance has always been the key area which help the carrier to have maximum load factor. We have recorded 84% OTP in August and 90% in September despite infrastructure constraints.”
The Airport Authority of India, in association with Directorate General of Civil Aviation (DGCA), has monitored the OTP of domestic carriers operating from Chennai from August 28- September 22, 2010.
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| THE AWAITED DASH FROM BOMBARDIER |
