The company has reported the highest ever quarterly profit after tax in the latest June quarter.
New Delhi: Fuelled by higher passenger revenues, InterGlobe Aviation on Friday posted its highest ever quarterly profit of Rs 1,203.14 crore for the three months ended June and asserted that co-promoters are on the same page on growth strategy.
The announcement of the good quarterly results also came amid ongoing feud between co-promoters Rakesh Gangwal and Rahul Bhatia over alleged corporate governance lapses.
InterGlobe Aviation, the parent of the country's largest airline IndiGo, also benefitted from the shuttering of cash-starved Jet Airways and improved performance on the cargo front in the latest June quarter.
It had a profit after tax of Rs 27.79 crore in the year-ago period. The profit in June 2019 quarter has increased more than 43 times, according to a regulatory filing.
Total income climbed to Rs 9,786.94 crore for the June quarter from Rs 8,259.69 crore in the same period a year ago, the filing said.
Its revenue from operations jumped nearly 45 per cent to Rs 9,420 crore.
Yield, which is an indicator of revenue earned for every kilometre flown, jumped to 12.8 per cent in the latest quarter.
In the latest quarter, cargo revenues increased by 35 per cent on account of increased range of products that were carried.
"Capacity during the quarter increased by 30 per cent... As we add more capacity we see significant opportunity for profitable growth by increasing our connections to tourist destinations in India," IndiGo CEO Ronojoy Dutta said.
He said the company has reported the highest ever quarterly profit after tax in the latest June quarter.
"Strong passenger revenues along with a sharp improvement in cargo performance were key drivers to this improved profitability," he said.
IndiGo, which has been on expansion path, had 235 planes in its fleet at the end of June. It flies to over 70 destinations.
As on June 30, IndiGo's cash balance stood at Rs 17,337.1 crore.
Amid concerns over the promoters' feud, Dutta said that when it comes to the overall strategy of growth and international expansion, the two promoters are totally in sync.
The board of IndiGo, which discussed results and issues such as appointment of woman director on Friday, would continue its meeting on Saturday.
"We continue to see a base increase of 5 per cent in our unit revenue due to our various initiatives. The discontinuation of the services of Jet Airways positively impacted profit this quarter helping our unit revenue to grow by 2-3 per cent to the best of our estimate," Dutta said.
Emphasising that the airline would continue with its aggressive growth, Dutta said it would start flights to Vietnam and Myanmar in the next quarter.
For the second quarter of current fiscal, the company expects ASK (Available Seat per Kilometre) to increase by 28 per cent on a year-on-year basis.
The rise is projected to be 30 per cent for financial year 2020.
"Everyone is scrambling for international. We started a little earlier than some of the carriers. The scramble is more to replace Jet. This has not added capacity. Jet capacity that went down is being replaced by partially by us, partially by Vistara and SpiceJet," Dutta said during a conference call to discuss the financial results.
IndiGo's Chief Financial Officer Rohit Philip said the company would like to use excess cash to start buying aircraft outright in addition to the sale-and-lease back model.
Ruling out replacing Pratt & Whitney engines with CFM engines for its planes, he said there are two different pools of engines. "We have a large number of Pratt & Whitney engines and they are still coming and CFM engines will not come till next year. So we are not going back, sort of replacing the Pratt with CFM," he added.
According to IndiGo, it has got around 30 per cent of around 150 departure slots at Mumbai and Delhi airports that were used by Jet Airways.
"We don't expect any impact of Jet Airways to continue as all airlines have replaced capacity vacated by Jet. Unfortunately, we are witnessing some low fares in the 0-15 day booking window and expect this to add pressure to our unit revenue into the current quarter," Dutta noted.
With effect from April 1, 2019, the company has capitalised its operating leases in accordance with Ind AS 116.
"The capitalised lease liability as of June 30, 2019 was Rs 1,60,701 million (Rs 16,070.1 crore). The total debt (including the capitalised lease liability) was Rs 1,84,309 million (Rs 18,430.9 crore)," the filing said.
Indian Accounting Standards (Ind AS) 116 pertains to leases.
Shares of InterGlobe Aviation closed almost flat on Friday, up 0.32 per cent at Rs 1,463.35 on the BSE.
During the day, it gained 1.96 per cent to Rs 1,487.25. Since July 9, when differences between the promoters went public, the scrip has fallen by 6.53 per cent on the BSE.