Addressing investor concerns over the falling stock price of Jet Airways, and the airline’s poor financial health, Founder-Chairman Naresh Goyal said on Thursday he felt “guilty and embarrassed” about it.
Speaking at the company’s AGM here, Goyal said the airline is still in a strong position despite increasing competition in India and abroad. He pointed to fuel prices as the key reason for the company’s losses.
“A lot of you have lost your money. Now we need to make sure how we get back because we are not inferior to competition,” Goyal told shareholders. “I feel guilty, I feel embarrassed that you guys have stood with us in the last several years, believing in us.”
Goyal appeared concerned over the company’s falling public image and said measures will be taken to improve the public sentiment towards Jet over the next couple of months. A new committee will is being set up to improve the public perception and get rid of the negative publicity that the airline has received of late, with news of salary cuts and cash constraints at the airline, he added.
Jet Airways directors Naseem Zaidi and Ashok Chawla will chair the meetings of this newly created executive committee, he further said.
The company is working with various international airlines to improve its code share network. Jet is also looking at cooperation with Air India in terms of engineering and flight operations, Goyal said, adding that several meetings have already been held with Air India Chairman and Managing Director Pradeep Singh Kharola.
Pay cut queries
The Jet Airways honchos evaded questions on reported salary cuts and possible retrenchment of employees at the company. Responding to shareholder queries, Vinay Dubey, CEO, said: “Many of you had questions around 25 per cent pay cuts. I will just say that we are looking at multiple elements of restructuring; payroll is one of them. We are in deep dialogue with our staff. They’re extremely supportive of our restructuring plan.”
Talking about returning to profitability, Dubey said the company is working diligently on a transformation plan that looks at every element of restructuring — from a cost perspective, from a revenue perspective, and also about revitalising customer experience. “We are looking at fleet costs, fuel costs, cost of sales, cost of distribution, maintenance, efficiencies on how we run our operations. The return to profitability will come through the execution of these things by the management team,” Dubey said.
“We have put out a guidance of 8-10 per cent growth in the foreseeable future. Our belief is to create a strong, growth-oriented company that is able to create free cash flows from operations,” he added.