SpiceJet net profit soars to Rs 102 crore

In a better-than-expected quarterly performance, India's fourth largest carrier in terms of passenger carriage SpiceJet today reported a net profit of Rs 102 crore for the quarter ending December, 2012.

The Kalanithi Maran-promoted carrier, which had reported a net loss of Rs 39.26 crore in the same period last year, clocked good numbers due to increase in revenues helped by international flights and increase in average fares in the domestic market.

For the October-December quarter, the carrier posted 37 per cent increase in revenue at Rs 1,603 crore compared to Rs 1,173 crore. The average passenger yields during the reporting quarter increased 29 per cent, while the number of passengers carried rose by 7 per cent.

The shares of the company jumped by a little over 5 per cent to close at Rs 46.15 on the BSE, after touching a day's high of Rs 47.30.

Due to cheaper fuel in the international sector, where fuel does not attract taxes, the airline's fuel cost as a proportion to total revenues fell to 45 per cent of the total revenue in the current quarter as against 50 per cent in the comparable quarter for the previous year.

The airline has credited the profits to strategic changes carried out in the last two years. "To announce a profit of Rs 102 crore for the third quarter in the current challenging environment is a huge achievement and clearly demonstrates that the strategic changes that SpiceJet have made in the last two years has created a platform for future success of the company," airline CEO Neil Mills was quoted in a release.

Analysts also were surprised with the huge profit SpiceJet has clocked in the third quarter. "SpiceJet has performed well in the quarter. We had projected a loss of Rs 29 crore for the quarter but the airline has registered a huge profit of Rs 102 crore, which means they have utilised the quarter normally a good quarter for airlines well," said Mahantesh Sabard, senior vice-president (equity and research) at Fortune Equity Brokers.

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