Turbulent flight

Mumbai, Sept. 28: Deccan Aviation, the parent of low-cost carrier Air Deccan, has reported higher losses for the quarter ended June 30 at Rs 173.09 crore against Rs 110.26 crore in the year-ago period.

The airline has been wallowing in losses and reported a loss of Rs 419.57 crore during the year ended June 30, which has been blamed on rising fuel costs and fare wars.

The low-cost carrier, which was brought under the management of Vijay Mallya’s UB Group a couple of months ago, had recorded a turnover of Rs 2,142.31 crore during the year.

Fuel expenses had risen to Rs 261.34 crore during the fourth quarter against Rs 222.6 crore a year ago — an increase of over 17 per cent.

Ramki Sundaram, CEO of Air Deccan, said, “Last year was one of challenges and transition; the focal point was optimisation of costs and efficiencies. We changed our reservation system, which has had a continuing cascading effect, influencing our ability to enhance our top line.”

The company has reported an overall revenue growth of 98 per cent on a normalised annual basis (2005-2006 was a 15-month period).

While new planes increased seat capacity, Deccan booked a gain of about Rs 12-16 crore by returning Airbus aircraft taken on lease. This boosted other income of the company during the financial year.

“At present, Deccan is focusing more on profit than market share. It has increased its revenue per ticket recently,” said Surbhi Chawla, aviation sector analyst at Angel Broking Ltd.

After joining hands with Kingfisher, the airline is now going through a gestation period. It is adding routes and augmenting aircraft strength.