Jet Airways Board To Consider Cost Cuts On Aug. 27
The board of Jet Airways (India) Ltd. will consider cost-reduction initiatives and a turnaround plan along with June quarter results at its meeting on Aug. 27.
The full-service carrier, grappling with financial woes, has been looking at ways to reduce costs amid high oil prices and intense competition. On Aug. 9, the airline's board deferred announcement of unaudited financial results for the June quarter and that would be taken up on Aug. 27.
While considering the results, the board would also “take up the matters in relation to the cost reduction initiatives and turnaround plan, for which the management had earlier sought time”, Jet Airways said its exchange filing on Wednesday.
The delay in announcement of financial results by the airline has already come under the regulatory scanner. The Corporate Affairs Ministry sought clarifications from the auditors of Jet Airways and markets regulator is also looking into the deferment of the results, sources had said.
On Aug. 9, Jet Airways Chief Executive Officer Vinay Dube said the carrier has been working very diligently and has been implementing for some time a mission plan that looks at every element of structuring from cost perspective, and revenue perspective among others. “We are looking at costs related to fuel, fleet, sales and distribution. And the return to profitability will come with the execution of these measures,” he had told shareholders at the annual general meeting.
On the issue of pay cuts, Dube had said that the airline was looking at multiple elements of restructuring and payroll was one of them. “We are in deep dialogue with our staff and they are extremely supportive of our restructuring plans... in that we will make the best decision in the interest of the company and the employees.”
On that day, Jet Airways Founder Chairman Naresh Goyal said that he felt “guilty and embarrassed” as a lot of shareholders have lost their money, amid the airline's shares plummeting on financial woes.
In recent weeks, shares of the airline has taken a beating on the bourses. On Tuesday, the scrip declined nearly 3 per cent to close at Rs 292.35 on the BSE.
About reports that the Corporate Affairs Ministry has opened a preliminary probe into alleged diversion of funds at Jet Airways, the airline said on Tuesday that it has not received any communication from the ministry in this regard.