Jet Airways Ltd. profit fell substantially in the September-ended quarter due to higher fuel expenses, foreign currency fluctuations and impairment losses.
Net profit in the second quarter fell 91 percent over last year to Rs 49.6 crore, the company said in an exchange filing today. Analysts tracked by Bloomberg had pegged the profit at Rs 99.3 crore. The carrier’s wholly owned subsidiary Jet Lite, to which it has advanced loans, continues to have a negative net worth, the filings showed.
Operating income of India’s second-largest airline fell 30.5 percent to Rs 836 crore. Operating margin contracted 720 basis points to 14.9 percent.
Fuel costs rose 16.7 percent to Rs 1,525.6 crore compared to the same quarter last year as aviation fuel prices have gone up. Foreign currency fluctuations led to a loss of Rs 72.9 crore for Jet Airways during the quarter. The airline accounted for an impairment loss of Rs 56.57 crore in the form of loans to Jet Lite. As a result, other expenses rose 26 percent over last year.
Jet Airways has been in talks with Air France-KLM for a joint venture in India and Europe, Bloomberg had reported in September.
Ahead of the earnings announcement, shares of the company closed 2.07 percent higher compared to a 1.1 percent rise in the benchmark S&P BSE Sensex.