Jet Airways Posts Heavy Losses in Q1

At the end of August this year, Jet Airways said it will seek capital infusion and sell the stake in its loyalty programme after reporting a net loss of 13.26 billion in the April-June quarter (Q1) of 2018-19. This is the airline’s third-highest quarterly loss. On August 9, 2018, Jet Airways had deferred its quarterly results amid differences with its auditors, leading to enquiries by stock exchange and the market regulator. The auditors reiterated that the airline’s future was dependent on raising capital and generating sustainable cash flows. The airline blamed increases in costs and low fares for the loss. Rival IndiGo’s profit fell 97 per cent in the quarter and SpiceJet incurred a loss of 0.38 billion. “The rise in the price of fuel, a depreciating rupee and a resulting mismatch between high fuel prices and low fares, adversely affected the Indian aviation industry, including Jet Airways,” said Chief Executive Officer Vinay Dube. Jet Airways Chairman Naresh Goyal said the board considered infusion of capital and monetisation of the airline’s stake in its loyalty programme for long-term financial health and sustainability. The loyalty programme, which Jet co-owns with Etihad, has 8.5 million members. It is managed through an associate company, earning revenue of 6.2 billion and a profit of 1.7 billion. Jet owns 49.9 per cent in the loyalty business.