Budget carrier SpiceJet on Wednesday reported a loss of Rs 13 crore (Rs 130 million) for the quarter ended June 30, 2006, mainly due to low ticket prices driven by competition. The company's revenues for the fourth quarter were Rs 154 crore (Rs 1.5 billion).
For the 12-month period, total loss stood at Rs 41 crore (Rs 410 million). The management expects the performance to improve in the quarters to come.
According to Sinddhanth Sharma, chairman, SpiceJet, "The promotional low-fare scheme that the carrier ran in the first three months of operations affected the margins greatly as also the high fuel costs."
Total income for the full year -- the first full year of operations for the company -- was Rs 453.14 crore (Rs 4.53 billion).
Domestic carriers have had a rather bad performance during the three months ended June 30. This is despite 25 per cent growth in passengers numbers.
For example, market leader Jet Airways reported Rs 45 crore (Rs 450 million) loss, mainly due to poor performance of its overseas operations.
According to Sharma, the overall performance in the first year was satisfactory and the company hopes to seen an improvement in the current financial year.
"We expect to break even at the net level this fiscal although, we have been able to achieve operating profits in the first year itself," Sharma said, adding that the carrier was targeting a turnover of Rs 910 crore (Rs 9.1 billion) this fiscal.
The airline's operating profit stood at Rs 71.52 crore (Rs 715.2 million) for the year ended June 2006. He said the carrier would be adding five new aircraft by January 2007 on sell-and-lease mode and will fly to new destinations.
"Already from October we will be flying to Varanasi and we plan to operate flights to Lucknow and Coimbatore," he added. Having carried 1.3 million passengers in the first year, SpiceJet is aiming to carry about 3 million this fiscal.
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