The below analysis has been performed by an aviation consultant and industry professional completely independently of Bangalore Aviation. The views expressed are not ours.
Jet Airways reported a profit of INR 2,217 million or USD 35 million for the 1st quarter of FY16. The results are fairly interesting when one looks at RASK and CASK comparisons that show RASK for the quarter at IN 4.49 while CASK was at 4.55.
Probing the numbers further, operating revenue rose by approximately 11% to INR 52,201 million while operating costs were up by only around 6% coming in at INR 52,8563 (includes finance cost).
Perhaps the biggest factor was the decline in fuel cost due to the lower fuel prices globally. Fuel costs for the quarter came in at INR 14,446 million and represented 28% of operating cost down from the 46% – 48% levels.
Overall passenger numbers were up and Jet carried 5.7 million passengers with a load factor of 82.5%. Yet intense competition in the sector coupled with fare sales and pricing dilution resulted in an average fare that was lower by 10% and around the INR 7,500 ~ 8,000 level.
Jet however has also included Income from Leasing of Engines at INR 2,072 million; Profit on Sale and Leaseback of Engines: INR 304,000; and contribution from lessors towards maintenance: INR 1,279 million towards the total profit figure.
While these amounts are revenue, on an operating level the perhaps don’t give the complete picture.
This may also explain, at least in part, as to why Jet is in the market for a bridge loan of around INR 16.5 billion after already raising approximately USD 300 million (about INR 18 billion at today’s exchange rates) earlier.