SpiceJet is India’s second-largest low-cost airline, which help many travelers to travel from one to place to another. SpiceJet has been offering low fare and promotional offers to attract more customers to pick their travel mode by air. The low fuel prices have provided SpiceJet some handsome profit. The airline celebrates their quarterly profit of Rs 73 crore for the period from January to March, which is Q4 of FY16. SpiceJet reported a profit of Rs 146 crore against a profit of Rs 80 crore in the same quarter last year, the airline said. On a yearly basis, the profit was Rs 640 crore against loss of Rs 397 crore last year.
This profit rate has been the fifth profitable quarter for the SpiceJet. SpiceJet have earned net profit of Rs 407 crore in FY16, against the loss of Rs 687 crore last financial year FY15. Moreover, to upgrade its fleet the airline has also decided to use Rs 173 crore as a one-time expense. Total revenue rose by 10% to Rs 1,474.98 crore in FY16, against Rs 791 crore which was in FY15.
Ajay Singh, chairman and managing director of SpiceJet said- “We decided to use the financial cushion to clear all debts and legacy issues. Every single legacy issues has been addressed and accounted for in this quarter”. Further, he added- “We have also provided for every single claim on the company’s books. Except three, all claims have been settled,”.
The cost of expenses came down with a decrease of 10%, which resulted in Rs 328.66 crore this year (FY16), when compared to Rs 366.63 crore last year (FY15). Due to the decrease in the cost of the fuel the total expenses also decreased to 20.26 per cent which turned out to be Rs 4,773.50 crore in FY16 against Rs 5,986.37 crore in FY15.
SpiceJet has increased its unit revenue by raising the load factor, on lower fares and promotion offers. For which the management of the SpiceJet says- the airline was planning to expand the units of aircraft’s by 100 units by the end of this financial year, FY17.
Verdict: SpiceJet have been serving great to its customers and helps them to fly across India and globe at quite low fares. This profits earned by the company shall bring in new advancements and the number of units that shall be increased by the end of FY17 shall enable to increase the travel frequency of the flight too.
Author: Mrs. Viveka Nagar