Mumbai, Aug 27 (IANS) Jet Airways Group on Monday reported a net loss of Rs 1,326 crore for the first quarter of 2018-19 from a net profit of Rs 58 crore earned during the corresponding period of the previous fiscal.
On a standalone basis, the airline’s net loss stood at Rs 1,323 crore from a net profit of Rs 53.5 crore reported for the corresponding quarter of the previous fiscal.
According to the airline, an increase in Brent fuel price by more than 36 per cent, along with a weak rupee and a mismatch between high fuel prices and low fares primarily undermined its financial performance during the quarter under review.
The company on August 9 had deferred to consider the financial results due to “pending closure of certain matters”.
“The Board of Directors, based on the recommendation of the Audit Committee, approved the company’s financial results for the quarter ended June 30. In their review of the financial results, the statutory auditors have issued an unmodified opinion on the results,” a company statement said.
“Given the challenging business environment, Jet Airways has been implementing additional measures to reduce costs and achieve greater efficiencies of operations.”
Besides, the airline’s Board considered various cost-cutting steps, debt reduction and funding options, including infusion of capital, monetisation of assets, including the company’s stake in its “Loyalty programme” to shore up its financial position.
“The two significant proposals considered by the Board of Directors on Monday, i.e., infusion of capital and the monetisation of the airline’s stake in its Loyalty programme bode well for the long-term financial health and sustainability of the airline,” Jet Airways Chairman Naresh Goyal was quoted as saying.
Accordingly, the airline plans to go in for a comprehensive cost reduction programme to reduce expenses totalling Rs 2,000 crore over two years.
“The cost reduction programme covers various facets of the company’s operations, including maintenance costs, selling and distribution costs, fuel rate and optimisation, debt and interest cost reduction and enhancement of crew and manpower productivity,” the statement said.
In addition, the company has decided for a “balance sheet restructuring” which entails capital infusion and debt reduction.