Jet Airways net loss narrows to Rs 218 cr, to build single brand by year-end
The second largest airline Jet Airways today reported a standalone net loss of Rs 217.65 crore for the quarter to June, down 39 per cent from the year-ago period.
Mumbai: The second largest airline Jet Airways on Monday reported a standalone net loss of Rs 217.65 crore for the quarter to June, down 39 percent from the year-ago period.
Revenue rose 17 percent to Rs 4,685.64 crore in the reporting period, while total passenger revenue rose 11.1 percent to Rs 4,262.6 crore, the airline said in a statement to the exchanges.
Codeshare pushed overall traffic by 157 percent to 1,18,253 during the reporting period primarily driven by the strength of Etihad Airways' alliance.
International operating results improved 86 percent, and is profitable, the Naresh Goyal promoted airline said, adding that the seat factor rose 2.3 percentage points to 80.2 percent, pushing up its yield 1.8 percent.
The airline termed the numbers as "strongly improved performance" and attributed the same to "the result of the three-year turnaround strategy and the partnership with Etihad started to impact the business positively."
Total number of revenue passengers who travelled with Jet Airways increased 4.3 percent to 5.19 million from 4.98 million, with passenger load factor increasing by 2.3 percentage points from 77.9 to 80.2 as the airline gained new customers.
Overall RASK (revenue per available seat km) rose 6.4 percent to Rs 4.68 from Rs 4.40, while domestic RASK rose 7.4 percent to Rs 5.53 from Rs 5.15, and international RASK rose 8.2 percent to Rs 4.18 from Rs 3.86.
International operations results improved 86 percent underpinned by a surge of 157 per cent in codeshare traffic, which grew to 1,18,253 passengers in the first quarter. This is expected to increase further as the full extent of the codeshare expansion with Etihad and Air France, which were activated only halfway through the quarter, take effect and Jet Airways' planned international network expands and more codeshares come online, the airline said.
Chairman Naresh Goyal said the airline is taking stringent measures to operate in an industry which continues to face tough challenges, and while there are no short-term solutions.
Jet Airways said it will be exiting low-cost services and will merge its two no-frills brands with parent full service carrier.
"By the end of this year, there will be no JetLite and Jet Konnect brands and all the aircraft will have business class and economy class seats," group chairman Naresh Goyal told reporters after the company's AGM.
"I give you my commitment, that by the end of the year, Jet Airways will have the best domestic full service product in the country. We will always be competitive to ensure our customers get the best value for their money," Goyal said.
He denied media reports that the airline was planning to sell off the loss-making JetLite brand.
Explaining the rationale, Goyal said: "Plan to go in for a single master brand strategy is to get rid of the confusion in the minds of customers. We will have a uniform full service product but will compete with low fare airlines by working on its cost structure."
He said the entire fleet will be reconfigured for domestic service and will offer 12 business class seats in each of them, with the rest being economy seats, which could be upwards of 150, depending on the aircraft make.
The airline will offer food on board, except for the very short haul routes.
Commenting on the Q1 numbers, Goyal said:"The first quarter results show we have made demonstrable progress in the implementation of our three-year turnaround strategy to return to profitability.
"However there are still challenges in the very competitive market in which we operate. Our next critical step will be re-establishing Jet Airways as a master brand in the country. This means harnessing our proud heritage and original values in one consistent, predictable and clearly recognisable brand."
JetLite currently operates a fleet of 11 aircraft under the JetKonnect brand across 50 cities.
The Economy Class will provide a differentiated offering to address the needs of travellers seeking value and competitive fares, while ensuring service continuity with inbound international flights.
The post-AGM press meet was also addressed by Etihad Airways president and chief executive James Hogan. Committing to stand by Jet Airways to turn it around, Hogan said, "We are there to support and we are here to rebuild Jet Airways."
Welcoming the Tata-Singapore Airlines venture which on Monday unveiled its brand identity as Vistara, which will be launched by October, Goyal said, it "will make us strong. I am very happy that they are coming".
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The airline company, which sold 24 percent stake to UAE carrier Etihad in April, had reported loss of Rs 99.7 crore in the same quarter a year ago.
For the year ended March 2015, Jet Airways saw its standalone net loss steeply narrow to Rs 1,813.71 crore from Rs 3,667.85 crore in the year-ago period.