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India's Biggest Domestic Airline Reports 53 Percent Profit Drop

Posted on: Monday, 23 January 2006, 09:00 CST

India's biggest domestic airline reports 53 percent profit drop

NEW DELHI, Jan. 22 -- India's biggest domestic airline company Jet Airways saw a 52.93 percent drop of net profits after tax in the third quarter of this fiscal year, Business Line reported Sunday.

Its net profit reached 610.1 million rupees (13.86 million US dollars) between October and December in 2005, down from 1.3 billion rupees (29.46 million US dollars) in the same period of the previous year, the company statement said.

The company attributed the profit dip to increasing capacity of the whole air industry in India, which has exceeded the demand growth, higher fuel price and operating loss on newly launched international flights.

But the company's net operating revenue has increased by 22.35 percent on year-on-year base to 14.78 billion rupees (335.97 million US dollars).

"Profitability of our domestic business remains strong with seat factors consistently above 70 percent," the statement said.

In the past nine months of the fiscal year, Jet Airways reported a 13.15 percent decrease in post-tax profits but 29.78 percent increase of net operating revenue.

The company has just made a buyout of its rival Sahara Airlines to become the largest domestic carrier in India with 22.17 billion rupees (503.86 million US dollars). Before this deal, Jet Airways had taken over 35 percent of domestic market shares while Sahara Airlines had had 11.6 percent.

The effectiveness of the deal will depend on how the integration of the two companies goes on, the company said.

Source: Xinhua News Agency - CEIS

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