InterGlobe Aviation owned Indigo declared their Q1 FY21 results on Wednesday. They have reported a net loss of Rs 2,844 crore in the quarter ended June 30. This is 336% less than what they reported in the same quarter previous year. Airlines industry is one of the most severely hit industries due to the COVID-19 pandemic.
It was already expected that the company will be reporting a huge fall in revenues and profits. A net loss was always on cards. Yet, the numbers declared by the airline company is below than what analysts estimated.
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Apart from its bottom line, the top line of the company has crashed massively. Revenue from operations has seen a slump of 92% from Rs 9420 crore to Rs 766 crore.
“The aviation industry is going through a crisis of survival and therefore, our cash balance remains our number one priority. However, we also recognize that major disruptions offer companies opportunities for improvement in product, customer preference, costs and employee engagement. We have built a strong team which is working on multiple fronts to ensure that we emerge from this crisis stronger than ever,” – Ronojoy Dutta, CEO of the company.
EBITDAR stands for Earnings before interest, tax, depreciation, amortization and aircraft and engine rental is calculated at Rs -14,212 million which is way below than the EBITDAR of INR 27,785 million reported in the same quarter previous year.
As per their filling, Indigo has a fleet of 274 aircraft which is 12 more than what was reported in the quarter ending March. The company also stated that they have resumed their operations in 56 domestic destinations. The company declared total cash of INR 184,498 million which is 6.4% higher than what was reported the previous year.
To stop the spread of the virus, the Indian government suspended domestic and international flight operations in the last week of March. The domestic flights were allowed to run since May 25 but there are a huge number of restrictions, from both the central and state governments. The restriction has now been extended till November 24. The flights running are told to operate at 45% capacity. It is clear to say that this is one of the toughest time an airline company can ever face. More than earnings and revenues, this is a time for them to fight for their survival.