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Gurugram June 30, 2021: SpiceJet, India’s favourite airline and the leading air cargo operator, reported a net loss of INR 235.3 Crore in the fourth quarter of FY21 against a loss of INR 807.1 Crore in the same quarter of the previous year as business continues to be severely impacted by the second wave of Covid-19 pandemic which has adversely hit operations and travel demand. The airline reported a net loss of INR 998.3 Crore in FY 2021.
While there has been significant losses suffered on the passenger side of business the dedicated cargo operations continued to provide much required lifeline to our over all operations. On a segment basis the revenue from cargo operations increased by 518% aggregating to INR 1,117.5 Crore for FY2021 with profit of INR 130.9 Crore for the full year against a loss of INR 134.2 Crore for the previous year. FY2021 posed multiple unprecedented challenges as we saw most parts of the world going into lockdown. With the second wave of the pandemic and the emergence of various mutant variants, the Company continues to see significant negative impact to demand for air travel. However, even as the company continues to monitor the impact of the pandemic on its operations and financial condition, it has also been implementing various mitigation strategies to protect its long-term sustainability.
The Company continues to incur various costs owing to the grounding and the inability of Boeing 737 Max aircraft to undertake revenue operations for over two years now. SpiceJet continues to engage with Boeing to recover damages incurred by the Company due to the grounding of the MAX and also engage with aircraft lessor of the grounded MAX aircraft to restructure the present leases.
Ajay Singh, Chairman and Managing Director, SpiceJet, said, “The intensity with which the second wave of Covid-19 struck and the unimaginable devastation it has caused, both for the already battered travel industry and generally, will take time to heal. To ensure our long term growth and sustainable operation we have decided to raise funds of up to INR 2,500 Crore. These funds will be used to significantly strengthen our balance sheet.”
“Much like the first wave, this time too, our cargo arm was exceptionally active and has performed extremely well transporting record quantities of supplies all across the globe. In order to provide greater focus to cargo business and raise additional capital, we will hive-off the cargo business to operate as a separate entity. The same will provide greater opportunity and flexibility in pursuing long term growth plan and strategies for the cargo business.”
“With vaccination touching record numbers and travel demand slowly picking up, we hope that the worst is behind us but we remain extremely cautious about the future. While there is still much work and recovery to be done we have managed to reduce our net loss in Q4 through re-structuring of our contracts which will have a significant positive impact in the long term.”
In terms of operational parameters, SpiceJet had the best passenger load factor amongst all airlines in the country. The average domestic load factor for the quarter was 77.3% while for fiscal 2021 it was 75.7%.
Disclaimer:
Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense competition in aviation sector including those factors which may affect our cost advantage, wage fluctuations, our ability to attract and retain highly skilled professionals, time and cost overruns on various parameters, our ability to manage international operations, reduced demand for air travel, liability for damages, withdrawal or expiration of governmental fiscal incentives, political instability, legal restrictions on raising capital or general economic conditions affecting our industry.
The words “anticipate”, “believe”, “estimate”, “expect”, “intend” and similar expressions, as they relate to us, are intended to identify certain of such forward looking statements. The Company may, from time to time, make additional written and oral forward-looking statements, including statements contained in our reports to shareholders. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company unless it is required by law.
About SpiceJet Ltd
SpiceJet is India’s favourite airline that has made flying affordable for more Indians than ever before. The airline operates a fleet of Boeing 737s, Bombardier Q-400s & freighters and is the country’s largest regional player operating 63 daily flights under UDAN or the Regional Connectivity Scheme. The majority of the airline’s fleet offers SpiceMax, the most spacious economy class seating in India.
The airline also operates a dedicated air cargo service under the brand name SpiceXpress offering safe, on-time, efficient and seamless cargo connectivity across India and on international routes.
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