SpiceJet First Quarter FY2018-19 Results

In August this year, SpiceJet, declared its first quarter results for the fiscal year 2018- 2019. Much like its rival IndiGo, it was a result that reflected the ongoing weakness in the market and was below expectations. SpiceJet had a revenue increase of 20 per cent against a capacity increase of 14 per cent . The RASK and load factor numbers indicate that not only are they selling aggressively, their revenue management is strong. Revenue management refers to how supply and demand are managed and as flights fill up, the fares are pushed higher. It is likely that the Q400 fleet is also delivering strong revenues. Fares on some sectors such as Gorakhpur-Delhi during the quarter, touched 8000 and against a short sector length, these result in a high RASK. International performance was also strong with continuous fare sales ensuring top of mind recall. Finally, SpiceJet continues to focus on the ancillary revenues and these were up 28 per cent. Their onboard offerings coupled with partnerships with other providers continue to deliver. While revenue performance was strong, costs rose in the quarter. SpiceJet’s CASK was 4.3. Compare this to Indigo’s CASK of 3.8 and it shows quite a difference. This difference was driven my major maintenance where expenses rose by 14 per cent.