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IndiGo Q1 Net Loss Widens To $426.8 Million

The Covid-19 pandemic impacted the company’s financial result, Indigo said. 

NEW DELHI — Indian budget airline IndiGo said on July 27 that its net loss in the first quarter of FY22 widened to INR 3,174 crore ($426.8 Million) from INR 2,844 crore ($382.4 million) in the same quarter of the previous fiscal year. The company’s first-quarter ended on June 30.

The airline industry faced subdued air traffic due to the Covid-19 pandemic, rising oil prices, and depreciation of the Indian rupee. The financial results were severely impacted by the second Covid-19 wave as the number of passengers traveling declined sharply in May and June, said Indigo Chief Executive Officer Ronojoy Dutta.

“With the second Covid wave receding, we are seeing a measured recovery in bookings for July and August,” said Dutta in a statement.

“Notwithstanding the industry’s present challenges, we remain firmly optimistic about IndiGo’s future.”

The company’s focus has been to manage cash balances, run a high-quality airline, continue to build capabilities, and be prepared for the post-Covid environment, Dutta said.

Covid-19 pandemic and the subsequent lockdown in the country has had an impact on the financial results, said the company.

Operationally, the low-cost airliner’s revenue rose by 292 percent to INR 3,007 crore ($404.3 million) during the first quarter of FY22 due to an extremely low base.

Moreover, it reported an EBITDAR (earnings before interest, tax, depreciation, amortization, and rent) loss of INR 1,360 crore ($182.9 million) for Q1 compared to INR 1,421 crore ($191 million) last year. The airline’s EBITDAR margins stood at 45.2 percent.

The company’s fuel costs jumped 853 percent to INR 1,216 crore ($163.5 million) in Q1 FY22 as compared to INR 127 crore ($17.1 million) in Q1 FY21.

“In the March quarter, we operated at 75 percent of pre-Covid-19 capacity, but during the June quarter, we operated at only 44 percent of pre-Covid-19 capacity. Such lower capacity deployment has negatively impacted our performance metrics,” said Jiten Chopra, Chief Financial Officer of Indigo, in a statement.

“The strength of our balance sheet is our biggest defense in the fight against Covid-19, and we will continue to enhance this strength by focusing on cost reduction, liquidity enhancement, and capacity addition.”

As of June 30, IndiGo had a total cash balance of INR 17,068 crore ($2.29 billion) comprising INR 5,621 crore ($755.8 million) of free cash and INR 11,447 crore ($1.54 billion) of restricted cash.

The airline has a fleet of 277 aircraft, including 85 A320 current engine options (CEOs), 122 A320 new engine options (NEOs), 41 A321 new engine options (NEOs), and 29 aircraft manufacturer (ATRs), marking a net decrease of eight aircraft during the quarter, the company said.

(With inputs from ANI)

Edited by Abinaya Vijayaraghavan and Praveen Pramod Tewari