SpiceJet treats MAX cost as other income
Budget carrier SpiceJet on Friday reported a net profit of Rs 73.2 crore for the three months ended December.
“The standalone profit from air transport services (airline) was Rs 115 crore. Further, this profit is after a non-cash forex charge on account of Ind AS 116 of Rs 75.9 crore without which the profit would have been Rs 190.9 crore,” the airline said in a release. Ind AS 116, or Indian Accounting Standard 116, pertains to leases.
In the December 2018 quarter, the carrier had recorded a profit of Rs 55.1 crore.
The no-frills carrier has been impacted by the grounding of its 13 Boeing 737 MAX planes since March last year as it is incurring various costs related to the aircraft.
Certain costs on Max, including aircraft and supplementary lease rentals, totalling Rs 537.27 crore have been recognised as other income during the nine months ended December, according to the notes. The amount includes Rs 246.42 crore recorded in the quarter ended December.
The MAX aircraft were grounded worldwide after two fatal accidents in late 2018 and early 2019.
Operational revenue in the latest December quarter climbed 47 per cent to Rs 3,647.1 crore. In the year-ago period, the same stood at Rs 2,486.8 crore.
The SpiceJet stock jumped nearly 6 per cent to close at Rs 89.60 on the BSE on Friday. During the day, it advanced 10.27 per cent to Rs 93.40.
Boeing offer under study
New Delhi: SpiceJet is considering the “interim offer of compensation” made by Boeing for grounded 737 MAX planes.
“Despite its inability to undertake revenue operations, the group continues to incur various costs with respect to these aircraft,” SpiceJet chairman and managing director Ajay Singh said on Friday.
Additional reporting by PTI