Almost two years after it began operation (May 2005) as a low-cost airline, SpiceJet Ltd is expecting to achieve operational breakeven in the current quarter (April-June).
BANGALORE: Almost two years after it began operation (May 2005) as a low-cost airline, SpiceJet Ltd is expecting to achieve operational breakeven in the current quarter (April-June).
“We are expecting to breakeven operationally in this quarter and should be able be able to report a small profit. This would be after deducting earnings from sales and leaseback of Rs 8.2 crore ($2 million),” SpiceJet Ltd CEO and managing director Siddhanta Sharma told DNA Money.
Except for full-service carrier Jet Airways, all Indian carriers have been reporting operating losses and none of the new carriers have broken even till now.
Deccan Aviation, which runs the largest budget airline Air Deccan, had reported an operating profit of Rs 33.14 crore in the December quarter (October - December, 2006) but that was on account of a sales and leaseback transaction.
Sharma said the airline’s profit would be achieved on the back of lower cost per unit and an exceptionally good season.
“Our yields for the quarter are looking good. This is what is making us confident enough to predict a breakeven in this quarter. We have been able to improve our yields as we now have control over our costs. Moreover, this quarter has been decent. And so, even though, we do not have very high load factor our yields have been good,” said Sharma.
The budget carrier’s yields in the previous quarter (December-February) had suffered due to fleet expansion from six to 11 aircraft since October. It had come down from Rs 2.20 in December to Rs 2.16 in January, and has further fallen to Rs 1.96 in February.
Even though, Sharma did not reveal the yields in the current quarter, he said they were certainly better than the previous quarter. Today, SpiceJet’s cost per unit is among the lowest in the industry. It was Rs 2.44 per available seat kilometre (ASKM) in the last quarter.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}