Jet Airways, SpiceJet to partly clear AAI dues by weekend

Prodded by the Airports Authority of India (AAI) to pay off their dues, Jet Airways and SpiceJet on Monday promised the state-run airports body to make part payments by this weekend, official sources said.

While SpiceJet would pay up Rs 25 crore by November 29 to clear its outstanding dues, Jet Airways has agreed to pay Rs 80 crore by November 29 and another Rs 12 crore of its dues by December 10, official sources said here.

Jet owes AAI a total of Rs 165 crore and SpiceJet Rs 119 crore, they said.

The two airlines informed the AAI about their readiness to settle part of their outstandings at a meeting today, as the airports body threatened to put them on a cash-and-carry arrangement if dues were not settled by month-end.

The sources said SpiceJet has paid another another Rs 15-18 crore which was not accounted for earlier.

As per official figures three months ago, five private airlines, including Kingfisher Airlines which has closed down, have over Rs 350 crore as dues pending towards AAI. The Vijay Mallya-owned airlines owes Rs 186.26 crore.

AAI has taken the litigation route against Kingfisher and Paramount Airways, which has also closed down, for realising its pending dues.

The dues of private carriers are monitored on regular basis and in case of delay, the AAI issues notices to the airlines for their settlement. The AAI also charges penal interest on delays.

More: http://www.indianexpress.com/news/Jet-Airways--SpiceJet-to-partly-clear-AAI-dues-by-weekend/1199567/

SpiceJet slumps over 6% on record loss in Q2

Shares in SpiceJet slumped as much as 6 per cent on Friday after the company posted a record loss of Rs. 559 crore in the September quarter. SpiceJet had reported a net loss of Rs. 164 crore in the same period last year. Revenue from operations rose 6 per cent, while passenger numbers were up 9 per cent.

As of 09.20 a.m., SpiceJet shares traded at Rs. 18.95, down 4.8 per cent, and underperforming the broader Nifty, which traded 0.3 per cent lower. The stock hit a low of Rs. 18.65 in early trade. SpiceJet was also among the most traded stock on the broader BSE 500 benchmark.

Last month Jet Airways, the only other listed Indian carrier that is operational, also reported a record quarterly loss for the three months ended September 30.

What went wrong?

High fuel prices and weaker rupee hurt SpiceJet's profitability. Jet fuel prices in India are among the world's most expensive because of provincial taxes. SpiceJet also had to contend with a rupee trading near a record low, raising fuel costs which are mostly denominated in dollars.

India's fourth-biggest airline by domestic market share and controlled by billionaire Kalanithi Maran's Sun Group, added two more international routes last quarter, taking the total to 10.

SpiceJet is widely seen as the next likely target for foreign investment after the government last year began allowing foreign airlines to buy as much as 49 percent of a local carrier. SpiceJet has said it has received some interest from potential investors but has not named any.

Aviation sector in a mess

Market leader IndiGo apart, all four of India's other airlines are money-losing. Kingfisher Airlines, once India's second-biggest carrier, has not flown in a year for want of cash and has had little success so far in its bid to revive operations.

SpiceJet's auditor said in the company's annual report as of end-March that the company's ability to remain a "going concern" depended on establishing profitable operations and raising funds.

SpiceJet has been without a chief executive since announcing Neil Mills' resignation in early August but the company recently appointed Sanjiv Kapoor, a former Northwest Airlines and Temasek executive, as its chief operating officer.

More: http://profit.ndtv.com/news/market/article-spicejet-slumps-over-6-on-record-loss-in-q2-371639

SpiceJet slips after auditor's remark

SpiceJet fell 3.18% to Rs 19.80 at 11:40 IST on BSE after the company's auditor raised concern over the firm's net worth.

Meanwhile, the BSE Sensex was down 223.15 points, or 1.13%, to 19,504.12.

On BSE, 24.37 lakh shares were traded in the counter compared with average volume of 29.87 lakh shares in the past one quarter.

The stock hit a high of Rs 20 and a low of Rs 19.10 so far during the day. The stock hit a 52-week high of Rs 50.90 on 7 December 2012. The stock hit a 52-week low of Rs 18.05 on 30 August 2013.

The stock had underperformed the market over the past one month till 27 September 2013, falling 2.15% compared with the Sensex's 9.79% rise. The scrip had also underperformed the market in past one quarter, sliding 20.74% as against Sensex's 4.51% rise.

The small-cap company has an equity capital of Rs 520.28 crore. Face value per share is Rs 10.

In the airline's annual report for 2012-13, auditors SR Batliboi and Associates has stated, "The company's operating results have been materially affected due to various factors and as at 31 March 2013, the company's accumulated losses has fully eroded the net worth of the company. The appropriateness of the going concern assumption is dependent on the company's ability to establish consistent profitable operations as well as raising adequate finance to meet its short term and long term obligations. Based on the mitigating factors discussed in the said note, management believes that the going concern assumption is appropriate and no adjustments have been made in the financial statements for the year ended 31 March 2013."

In its outlook in the annual report, SpiceJet said that while the industry outlook for financial year 2013-14 looks a bit challenging, the company has increased its foot print in international operations and will continue to add international destinations and routes. This will result in additional aircraft utilisation and secure better yields. This will also offset the risk of infusion of additional capacities into domestic sectors.

Net profit of SpiceJet declined 9.96% to Rs 50.56 crore on 19.57% rise in net sales to Rs 1688.48 crore in Q1 June 2013 over Q1 June 2012.

SpiceJet currently operates more than 330 daily flights to 42 Indian cities and 7 international destinations.

Credits: business-standard.com