Indian LCC IndiGo reported a significant drop in profit for the December quarter, as the carrier continues its rapid fleet and capacity growth.
The airline achieved a profit of INR1.9 billion ($26.6 million) for the three-month period, its fiscal third quarter. This was down by 75% from the INR7.6 billion profit for the same period a year earlier. The carrier said major reasons for the decline were high fuel prices and currency depreciation.
Capacity for the December quarter increased 32.9% year-on-year and is expected to be up by 34% in the current March quarter. “Very few airlines around the world have the operational resilience to absorb such rapid growth,” IndiGo founder and interim CEO Rahul Bhatia said.
Bhatia noted that although weakness in October pulled down the results, unit revenues rose in November and December. This shows that “the markets we serve are responding very positively to this new capacity,” he said.
Operating revenue increased 28.1% in the quarter. However, overall costs climbed by 50.6%, partly because of a 69.2% rise in fuel expense…
