Airliners-India.com

me111993 · Member Joined: 04 Sep 2009 Posts: 3225 Location: MAA/AMD

Moneycontrol Bureau
Jet Airways’ net loss for the June quarter widened to Rs 123 crore,
compared to Rs 3.5 crore last year, as fuel costs rose 57%. The
loss was lower than analyst estimates, as the company showed
Rs 118 crore as receivable from its maintenance vendor. But for
this accounting entry, the net loss would have been much higher
at Rs 241 crore.
On a standalone basis, the company’s quarterly revenues rose
18.5% year-on-year to Rs 3524 crore. Jet said passenger yields
could not be improved beyond a point due to the ongoing price
war in the industry. The company tried to improve yields by
withdrawing discounts, but that reduced demand.
The company warned that high fuel price and price war would
continue in the current quarter too.
“International crude prices continue to be around $100 per barrel
and will impact Q2 numbers as well. Pricing activities by
competition continues and this will put pressure on yields in what
already is the weakest quarter of the year, ” the company said in its
outlook statement.
Yet, the company’s share rose 3% on Friday to close at Rs 500.
Jet’s dismal Q1 performance did not come as a surprise to
analysts who had predicted a net loss varying between Rs 200-Rs
300 crore.
An analyst attributes the losses to irrational pricing in the industry.
“ In January-February, Air India slashed its fares more then 30%.
This, put pressure on Jet to also sell below cost which put
tremendous pressure on its yields, ”
said an analyst who did not want to be named.
It is not just high fuel cost that is eroding the company’s margins;
the ongoing court case with Sahara is also a cause for concern. Till
the issue is resolved, the company cannot develop its property at
Bandra Kurla Complex and cannot do a sale-and-leaseback
transaction of a few aircraft to improve cash flows.

So, there you go, our ever loved national carrier lives by the formula "not die and kill"! Q2 won't be much good either.
_________________
Causal Determinism : We are hardwired to need answers. The Caveman who heard a rustle in the bushes and checked out to see what it was, lived longer than the guy, who assumed it was just a breeze.

- Greg House

flyjet787 · Member Joined: 26 Jan 2010 Posts: 282

I think fares are back to normal. AI cut down fares drastically after the strike ended. But I think they are now back to the normal fares now.

Nimish · Posted: Sat Jul 23, 2011 10:43 am Post subject:

If the US legacies can make pots of money this quarter (other than AA), it's a shame that Indian carriers are not able to make money. Of course one may question the link between the US carriers and Indian carriers, but essentially fuel prices and business demand follow pretty similar trends across the globe.

The entire Indian aviation business is really in the red!
_________________
We miss you Nalini!

me111993 · Member Joined: 04 Sep 2009 Posts: 3225 Location: MAA/AMD

US registered profits, UA/CO registered profits of over $500 million!
_________________
Causal Determinism : We are hardwired to need answers. The Caveman who heard a rustle in the bushes and checked out to see what it was, lived longer than the guy, who assumed it was just a breeze.

- Greg House

Nimish · Posted: Sat Jul 23, 2011 11:16 am Post subject:

Will joining an alliance help 9W's numbers? I mean look at UA/ CO and the strong JV they have with LH/ AC, and the extensive collaboration with other *A partners - is that helping them in the overall equation?
_________________
We miss you Nalini!

jasepl · Member Joined: 26 Jul 2008 Posts: 4257 Location: bund-bay

me111993 · Member Joined: 04 Sep 2009 Posts: 3225 Location: MAA/AMD

A big part of this loss can be attributed to the BKC land deal and the S2 court case which just seems to be getting worse and worse everyday.
_________________
Causal Determinism : We are hardwired to need answers. The Caveman who heard a rustle in the bushes and checked out to see what it was, lived longer than the guy, who assumed it was just a breeze.

- Greg House

jasepl · Member Joined: 26 Jul 2008 Posts: 4257 Location: bund-bay

Without knowing the details, I don't see what one has to do with the other.
_________________
four years free of jetya punti!

me111993 · Member Joined: 04 Sep 2009 Posts: 3225 Location: MAA/AMD

me111993 · Member Joined: 04 Sep 2009 Posts: 3225 Location: MAA/AMD

Detailed Report

High fuel prices and difficult pricing environment impact operating performance, Jet group reports ebitdar of INR 3,120 mio for Q1 FY12 .
July 24, 2009

Editor’s Synopsis (Jet Airways and Jetlite combined): Q1 FY 2012
Jet Group Q1 FY12 Total Revenue (combined) of INR 40,145 million (US$ 898.1 million); up by 14.7%
Q1 FY12 passenger growth of 13% vs same period last year EBITDAR of INR 3,120 million (US$ 69.8 million) for Q1 FY12

Highlights for quarter ended June 30, 2011 vs. June 30, 2010 – JET AIRWAYS STANDALONE
Operational
System-wide ASKMs of 9,319 million, up 14%
System-wide RPKMs of 7,311 million, up 12%
System wide seat factor of 78.5% vs. 79.7%
4.07 million revenue passengers carried, up 14.6%

Financial
Revenue of INR 35,824 million or US$ 801 million versus INR 30,232 million or US$ 651 million; up 18.5%
Fuel INR 15,637 million (US$ 350 million) vs INR 9,959 million (US$ 214 Million) in Q1 FY11; up 57%
EBITDAR of INR 3,286 million US $ 74 million in Q1 FY12 versus INR 6,044 million or US $ 130 million in Q1 FY11.
EBITDAR Margin at 9.3% in Q1 FY12 versus 20.4% in Q1 FY11
Loss before tax INR 1,568 million or (US$ 35.1) million vs profit of INR 35 million or US$ 0.8 million
Loss after tax INR 1,232 million or (US$ 27.6) million vs profit of INR 35 million or US$ 0.8 million
Exchange rate used 1 US $ = INR 44.700 for current quarter and 1 US $ = INR 46.445 for previous year same quarter

Highlights for the quarter ended June 30, 2011 vs. June 30, 2010 - JETLITE
Achieved seat factor of 80.1% in Q1 FY12 versus 82.5% in Q1 FY11
Total Revenue INR 4,321 million (US$ 96.7 million) versus INR 4,758 million (US$ 102.4 million) for Q1 FY’11
Fuel cost INR 2,770 million (US $ 62.0 million) versus INR 1,889 million (US $ 40.7 million) up by 46.6%
EBITDAR of (INR 166) million or US$ (3.7) million in Q1 FY12 versus EBITDAR of INR 990 million or US$ 21.3 million in Q1 FY11
Loss before tax INR 52 million or (US $ 1.2) million versus profit of INR 49 million or US $ 1.1 million
Loss after tax INR 53 million or (US $ 1.2) million versus profit of INR 49 million or US $ 1.1 million

Management Discussion and Analysis (for the quarter)

The domestic operating environment continued to be challenging in Q1 largely due to competitive pricing activities. Airlines had, in April 2011, looked at increasing yields by not discounting but the same resulted in muted demand and low seat factors. In May and June 2011, pricing in the market was impacted due to 2 big carriers dropping fare levels below costs which eventually led to lower market fares. Despite such an environment, Jet Airways improved its yield per passenger by over 10% Year over year.

Q1FY12 also saw steep increase in fuel prices (over Q1 FY11), which consumed all of the increases in revenues during the quarter. It was due to our stringent cost saving measures and regular tactical route rationalisation initiatives that Jet Airways posted operating profits (EBITDAR) of INR 3,286 million for the quarter.

Our Cost per ASKM (excluding fuel) reduced from INR 1.63 in Q1 FY11 to INR 1.58 in Q1 FY12, a reduction of 3.3%

The fuel rates increased by 39% as compared to the same period last year and by 12 % as compared to Q4FY11. The Fuel costs for the group were 42% of the total costs in Q1 FY2012 versus 34% in Q1 FY2011. The absolute difference in fuel costs for Jet Group as compared to the same period last year was INR 6,558 Million (US $ 147).

The Jet Group continues to maintain its leadership position in the Indian aviation industry with the highest market share of 25.5 % for the quarter ending June 2011.

Mr. Nikos Kardassis, Chief Executive Officer, Jet Airways (I) Ltd said, “Jet Group has further consolidated its leadership position in Indian skies by carrying a record 2 million guests in the month of May’ 2011 further reiterating the fact that Jet Airways, Jet Airways Konnect and JetLite have all catered to distinct passenger segments.

It has been Group’s ability to fully anticipate customer and market requirements and consequently customize its product to cater to these requirements that has helped Jet Airways stay ahead. I am certain that our focus to deliver customer delight will further help Jet Airways build its industry benchmarks of convenience and comfort.

At the same time, our On Time Performance and service delivery has also seen consistent improvements over the last few months, something which we are very proud of. The near term poses some challenge in terms of crude oil prices but I am sure, we will come out of this as a much stronger and smarter airline”

Highlights of Jet Airways Domestic operations Q1 FY’12

Domestic operations accounted for 43% of total revenues INR 15,462 million (USD 345.9 million). Domestic traffic for the Jet Airways group grew by 12% for the quarter vs same period last year. As against this, industry traffic grew by 15%.

Seat factor for Jet Airways Domestic operations was 74.6% for Q1 FY12 and Capacity in terms of ASKMs was 3,216 million which is up 16% versus Q1 FY11.

Highlights on International operations Q1 FY’12

International operations accounted for 57% of total revenues INR 20,362 million (USD 455.5 million). We achieved seat factor of 80.5% in Q1FY12 versus 80.1% in Q1FY11.The EBITDAR margins are at 11.2% in Q1FY12.

For the quarter, International traffic grew by 19.6% for the quarter vs. same period last year.

Outlook

International crude oil prices continue to be in the US$100 per barrel levels and will impact Q2 numbers as well. For the domestic business, we expect muted growth in capacity over the next few months while demand continues to grow at around 15%. Pricing activities by competition continue and this will put pressure on yields in what already is the weakest quarter of the year.

In the international business, we enter our strongest months and the forward bookings suggest that the demand and yield growth is strong. We expect to maximize seat factors in Q2 FY12 on account of our ever improving network presence and excellent service levels. High level of fuel price continue to be a cause of concern in international operations as well, however, there is a propensity to marginally increase yields in the current quarter, due to seasonality.
_________________
Causal Determinism : We are hardwired to need answers. The Caveman who heard a rustle in the bushes and checked out to see what it was, lived longer than the guy, who assumed it was just a breeze.

- Greg House

jasepl · Member Joined: 26 Jul 2008 Posts: 4257 Location: bund-bay

Have they actually paid any of those fines? It doesn't seem like they have tried to take possession of the land, so they wouldn't have had to pay the additional interest.

The Sahara problems indicate a big penalty, but that seems to be stuck in appeal. It's not clear if it was paid or not.

Such large payouts are typically highlighted in management's reports. Especially because management always try to claim losses aren't all their fault (back to my blaming the world point above).

They do have a decent operating profit, which is good.
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four years free of jetya punti!