Page 27 - AAA MAY - JUNE 2015 Online Magazine

FEATURE AvIATION BuSINESS

Under its new leader the low cost flights and was on the verge of closure. airline’s financial health and operations
carrier has reported a profit of 225 million The airline had also received approvals under the new promoters.
rupees in January-March 2015 quarter as from insurers for one of its Bombardier The company’s promoters will raise
against a loss of 3.22 billion rupees is the Q400 aircraft, which sustained extensive an additional 3 billion rupees ($47 million)
same period last year. damage during operations, for an “through various sources” and increase
“These results indicate that a recovery insurance claim of 1.61 billion rupees (of its fleet size to 45-50 aircraft by the end
is in progress, and is the first tangible which 835 million is payable to the relevant of year ending March 31, 2016, says the
evidence of the ongoing revival. We are aircraft lessor/relating to the outstanding airline official.
confident that we will build a world-class liabilities) that has been recognised as an The cash-strapped airline had received
airline and this is the first step. We still extraordinary item, during the quarter. an approval from India’s aviation ministry
have a lot of work to do... I am delighted Sanjiv Kapoor, COO, SpiceJet, said, “I in January to infuse 15 billion rupees
to see the airline that I helped create 10 am thrilled that with the return and backing ($243 million) by March-end submitted by
years ago starting to get back on its feet of the founder of the airline, Mr Ajay Singh, its new chairman and managing director
in this manner,” Singh said. SpiceJet has is clearly turning the corner. I Ajay Singh and other investors.
The income from operations, however, firmly believe this is the start of what will The airline briefly grounded its fleet
fell by almost 40 per cent to 7.86 billion be noted as a historic airline turnaround, in December after oil firms refused fuel
rupees in Q4 as the airline had sharply cut not just in India, but in the world.” supplies until it paid its dues. The aviation
The airline has for the first time ministry later lifted the restriction on
reported profit in the fourth quarter of a advance bookings.
fiscal since 2010. The company is hoping that with the
“The numbers include the benefit of new promoter Singh at its helm, it will get
renegotiated contracts and settlements, additional funds to tide over the financial
the provisioning for re-delivery expenses, turmoil and strengthen its operations. In
and a net gain on an insurance claim,” an December, Singh put $240 million into the
official of the airline said. company to bring the airline back on the
The airline survived a turmoil when road to recovery.
in March, courts had ordered DGCA to On May 21, the board of directors also
deregister 11 of SpiceJet’s Boeing planes took on record the company’s efforts to
following disputes with three lessors. increase its fleet size to 45-50.
As part of the plan, approved by the In April, the airline took delivery of
civil aviation ministry, Singh committed three B-737 aircraft. These airplanes
an investment of 15 billion rupees have been wet-leased from TVS, a firm-
(US$236 million) in the carrier, of which based out of Czech Republic. In wet lease,
he has already infused 6 billion rupees in besides aircraft, pilots and crew are
February immediately after taking over its included whereas there is only aircraft in
ownership. dry lease.
On 19 May, celebrating ten years of Airline officials also announced plans
operations, SpiceJet had announced that to hire at least 100 pilots and 200 cabin
it would be offering tickets for as low as crew to ramp up operations.
1, 010 rupees inclusive of taxes. he three- The company recently announced
day special sale ended on the midnight of promotional offers including a three-day
21 May and tickets at the discounted rate discount sale of tickets starting at 1010
will be available for flights from 1 July rupees ($17) to encourage travellers with the
2015 to 15 October 2015. advent of the peak summer travel season.
The Gurgaon-based carrier currently
has a fleet of 34 planes - 19 Boeing 737s
and 15 Bombardier Q-400s operating
over 235 daily domestic and international
flights.

To Raise Funds, Swell Fleet Size
SpiceJet has also announced plans to
expand its fleet size and raise more
funds as part of revival plan to restore the
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