OREANDA-NEWS.  January 20, 2012. Jet Group reported an operating profit of Rs. 2,566 million or USD 48.3 million for Q3 FY12

 Q3 FY12 Total Revenue (combined) of Rs. 45,199 million or USD 851.1 million up by 13.1%,

 Q3 FY12 passenger growth of 13.4% versus same period last year

 EBITDAR margin for Q3 FY12 of 5.7%

Highlights for quarter ended December 31, 2011 versus December 31, 2010 – JET AIRWAYS

Operational
System-wide ASKMs of 9,981 million, up 12.6%
System-wide RPKMs of 7,764 million, up 10.4%
System wide seat factor of 77.8% versus. 79.3%
4.53 million revenue passengers carried, up 15.1%


Financial
Revenue of Rs. 39,869 million or USD 750.8 million up by 13.6%
EBITDAR of Rs.2,099 million or USD 39.5 million in Q3 FY12
EBITDAR Margin at 5.3% in Q3 FY12
Loss before tax Rs. -1,012 million or USD -19.1 million
Loss after tax Rs. -1,012 million or USD -19.1 million


Exchange rate used 1 USD = INR 53.105 for current quarter and 1 USD = INR 44.705 for previous year same quarter

Highlights for quarter ended December 31, 2011 versus. December 31, 2010 - JETLITE
Achieved seat factor of 78.6% in Q3 FY12 versus 82.6% in Q3 FY11
Revenue of Rs. 5,329 million or USD 100.4 million, up by 9.5%
EBITDAR of Rs. 467 million or USD 8.8 million in Q3 FY12
EBITDAR Margin at 8.8% in Q3 FY12
Loss before tax Rs. -216 million or USD -4.1 million
Loss after tax Rs. -216 million or USD -4.1 million

Management Discussion and Analysis (for the quarter)

 Despite, Q3 being traditionally the strongest quarter, high fuel prices and continued depreciation of the Indian Rupee have impacted the operating results. However, yield improvement and other cost reduction initiatives during the quarter has helped the airline to post an operating profit.

 The Jet Group continues to maintain its leadership position in the Indian aviation industry with the highest market share of 26.5 % for the quarter ending December 2011.

 Mr. Nikos Kardassis, Chief Executive Officer, Jet Airways (I) Ltd said,

 “High fuel prices together with depreciating Indian Rupee versus US Dollar have pulled down the operating results to an extent; however yield improvements due to seasonality and narrowing gap between demand supply imbalances have helped the airlines to post operating profits.

 We continue to remain competitive through innovative marketing initiatives, increase in ancillary revenues enduring focus on cost cutting measures through contract renegotiation and process improvements across all segments of the business.

 At Jet Airways we remain committed to consistently improving our legendary warmth, service, reliability and courtesy delivered by an attentive staff to ensure that we achieve customer delight”

 Jet Airways continues to consolidate its position as India’s premier airline as is visible in the multiple awards that the airline has garnered in recent times, which includes a) “Best in Aviation” conferred at the prestigious "NDTV Profit Business Leadership Awards 2011" b) “Best Airline in central/south Asia and India” conferred by Prestigious Global Traveller reader survey awards 2011 c) “Best domestic airline” conferred by Travel Agents Association of India (TAAI).

 All of which is further testimony to the emergence of the airline as the preferred choice for guests travelling to and from the Indian subcontinent

Highlights of Jet Airways Domestic operations

 Domestic operations of Rs. 17,811 million or USD 335.4 million accounted for 45% of total revenues.

 Domestic traffic for Jet airways grew by 16.4% for the quarter versus same period last year. Seat factors were 75.2% in Q3 FY12 versus 76.9% in Q3 FY11.

 The EBITDAR margins are at 1.9% in Q3FY12

Highlights on International operations

 International operations of Rs. 22,059 million or USD 415.4 million accounted for 55% of total revenues.

 Over this period, the achieved seat factor on the International routes was consistently around 80% reflecting the maturing nature of the International operations.

 For the quarter, International traffic grew by 12% for the quarter versus the same period last year.

 The EBITDAR margins are at 8.1% in Q3FY12.

Other highlights

 The change in the policy of accounting for forex losses on loans has resulted in a gain (unrealised) of Rs. 1,790 million for the quarter which has impacted the results positively.

 During the quarter, we realised the Rs. 5.0 billion on account of the sale of the development rights for the BKC property and we have credited an amount of Rs. 1,029 million on account of the same for the quarter

Outlook

 The Indian domestic market will continue to grow at a rate of 12 to 15% in the short to medium term. The capacity induction in the market has slowed down thereby giving considerable scope for airlines to push for higher yields and we saw some semblance of this from November 2011. ATF Prices and rupee depreciation vis-a- vis US dollar continues to be a cause of concern for the short term. Q4 passenger bookings show encouraging trends, however it will reflect some seasonality.

 The weakening of the Indian Rupee vis a vis the US Dollar has had an impact on the US Dollar related costs including for the ATF that we uplift out of India because the same is priced in USD. Though we have a natural hedge in terms of our US Dollar earnings to a big extent, we are still impacted because of the same and this is largely uncontrollable in the short term. Consequently, many of the cost line items have a currency impact embedded in it.

 We are continuing to see a steady increase in our corporate and business class bookings over the last few weeks, given what has been happening in the industry and with competition. We are not seeing any major slowdown in our international bookings into and out of Europe and North America.

 Our International operations continue to achieve seat factor of around 80% even in a troubled financial environment in the west.

 Our relentless focus on cost cutting measures through contract renegotiations, process improvements and improving ancillary revenues is helping the airline to remain competitive and this should augur well for the future

 We hope to complete the transition from Jetlite to Jet Konnect during this quarter, which will enable us to consolidate our market leadership position with two strong brands

 Our funds raising initiatives are well on track. We have realised monies from the BKC deal as well as through Sale and Lease back of engines in Q3.

 Going forward, we expect to complete the Sale and Lease back of some of our B737 aircraft during the fourth quarter which will not only help us pay off high costing Rupee debt but also in paying off some working capital loans from the surplus cash that we will generate.