India's second-largest budget carrier SpiceJet Ltd has turned profitable after six consecutive quarters of loss registering a net profit of Rs 22.5 crore in the quarter ended March 31, 2015 as against a loss of Rs 321.5 crore in year ago period.
The was, however, mainly due to "the benefit of renegotiated contracts and settlements, the provisioning for re-delivery expenses, and a net gain on an insurance claim," SpiceJet said.
Notably, the carrier posted an exceptional gain of Rs 61.35 crore in the quarter due to insurance claims received for one of its damaged Bombardier Q400 aircraft.
On the operations side, it benefited from lower fuel expenses that fell two thirds to Rs 286.22 crore and aircraft lease rental expenses dropped by 61 per cent to Rs 115.39 crore in the quarter.
Net sales of the carrier, however, halved to Rs 782 crore compared with Rs 1,572 crore in the year-ago period. The airline ended the quarter with a load factor of 81 per cent.
“These results indicate that a recovery is in progress, and is the first tangible evidence of the ongoing revival,” said Ajay Singh, chairman, SpiceJet Ltd.
For the full fiscal ended on March 2015, the airline managed to bring down its losses to Rs 687.05 crore from Rs 1003.24 crore in the previous fiscal.
Net sales declined to Rs 5,172.7 crore for the full year compared to Rs 6,238 crore in FY14.
The carrier was on the verge of shut-down when co-founder Ajay Singh, who had exited the airline in 2010, came in and agreed to take over the company earlier this year.
Singh acquired controlling 58.46 per cent held by media magnate Kalanithi Maran, as part of the revival plan that would also see separate capital infusion of a little over Rs 1,875 crore ($300 million) from new as well as outgoing promoter Maran.
SpiceJet is the second-largest budget carrier in the country behind IndiGo and overall the fourth-largest carrier by passenger numbers in India. It operates 245 daily flights to 41 destinations, including 34 Indian and 7 international cities.
On Friday, shares of SpiceJet closed the day at Rs 20.15 each, up 6.61 per cent on BSE in a strong Mumbai market.
Meanwhile, the carrier announced that it has appointed Kiran Koteshwar, who was acting chief finance officer (CFO) and vice president - business strategy and projects at the carrier, as CFO of the company.
Koteshwar has been associated with SpiceJet since January 2007. Prior to joining SpiceJet, he worked with Go Airlines Pvt Ltd.
The country's second largest carrier Jet Airways Pvt Ltd, meanwhile, cuts its net loss to Rs 1,729 crore for the quarter ended March 31, 2015 as compared to loss of Rs 2153.6 crore in the year-ago period. Its net sales rose 10.2 per cent to Rs 4626.79 crore.
For the full year, Jet posted consolidated net loss of Rs 2097.4 crore compared to loss of Rs 4129.76 crore in FY14. Consolidated net sales rose 10 per cent to Rs 19380.73 crore last year.