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India's SpiceJet posts surge in Q3 passenger revenue on travel rebound

February 25, 2023 00:00:00

BENGALURU, Feb 24 (Reuters): India's SpiceJet Ltd reported a 33 per cent surge in third-quarter passenger revenue on Friday as the low-cost carrier flew more customers at higher fares amid a boom in travel demand, sending shares up 13 per cent to a two-month high.

The results come as the cash-strapped airline looks to raise capital with competition heating up in the industry.

A rebound in passenger travel ensured strength in revenue for airlines like SpiceJet and rival IndiGo.

For the quarter ended Dec 31, SpiceJet's passenger revenue surged 33 as yields, a proxy for airfares, jumped 21 per cent.

That helped offset a sharp decline in revenue from its freight and logistics business. Overall revenue was up 2.5 per cent at 23.15 billion rupees.

"There are renewed signs of recovery and some very positive developments and restructuring initiatives in the immediate offing that would significantly strengthen and de-leverage our balance sheet," Ajay Singh, chairman and managing director, said in a statement.

Profit rose to 1.07 billion rupees ($12.93 million) for the three months ended Dec 31 from 232.8 million rupees in the year-ago quarter, which was impacted by a one-off expense of 774.6 million rupees related to a settlement with an aircraft manufacturer.

The company said average aviation turbine fuel price rose by 48 per cent during the quarter, while the Indian rupee depreciated 11 per cent against the US dollar.

The carrier's load factor, or the passenger carrying capacity being utilised, improved to 91 per cent from 85.2 per cent.

Meanwhile, SpiceJet rescheduled its board meeting to consider capital raising options from Friday to Feb 27.

The airline last year suffered a string of mid-air safety lapses that drove India's aviation regulator to halve its approved fleet in July 2022. The curb was removed on Oct 30.

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