Jet Airways Posts Record Quarterly Net Profit

February 7, 2016

Jet Airways' December quarter net profit rose more than seven times, with sharply lower fuel costs helping the carrier post a third consecutive quarterly gain following a series of losses.

Jet, India's second largest carrier by market share, said net profit in the October-December period rose to INR4.67 billion rupees (USD$68.88 million) from INR631.1 million rupees a year earlier.

The airline's fuel expenses dropped by 27 percent in the period, its fiscal third quarter. Total income from operations grew by 8 percent to INR54.44 billion rupees aided by a 20 percent surge in passenger traffic, the company said in a statement.

"Our strong operational performance resulting in record profit demonstrates the progress we continue to make in our turnaround plan," chief executive Cramer Ball said in a statement.

Despite rapidly rising demand for air travel in India, Jet, which is 24 percent-owned by Etihad, has not made an annual profit since 2007, dragged into the red by high operating costs and fierce competition for passenger fares.

"The competitive and structural challenges in the Indian aviation market continue to put pressure on our yields. In addressing these, we will focus on cost reduction and leveraging the commercial and operational synergies through our partnership with Etihad Airways," Ball said.

The outlook for Indian airlines has improved due to a drop in fuel prices, which accounts for the bulk of their operating expenses, and growing passenger numbers in one of the world's fastest-growing yet fiercely competitive aviation markets.

(Reuters)