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Interglobe Aviation Ltd, the parent company of IndiGo, announced an impressive 110.68 per cent growth in third-quarter profit, fuelled by robust air travel demand. The standalone profit for the quarter ending December 31 reached ₹2,998 crore, compared with ₹1,423 crore in the previous year. Concurrently, revenue from operations surged to ₹19,452 crore, marking a 30 per cent increase.
CEO Pieter Elbers commented during the earnings call, “For Q3 FY24, we reported a profit after tax of ₹3,000 crore with a profit after tax margin of 15.4 per cent. With these five consecutive quarters of profit, we continue to recover from the losses of Covid and have now become net worth positive again.”
During the quarter, revenue from operations saw a notable rise of 30.26 per cent, reaching ₹19,452 crore from ₹14,933 crore in the same period last fiscal. Elbers noted the positive trend, stating, “The supply chain issues started around 18 months ago. The count of Aircraft on Ground (AOG) showed an upward trajectory during this period. Our early actions enabled us to navigate the situation in a desired manner and helped us grow capacity in each and every quarter. Looking ahead to the calendar year 2024, we still have headwinds in the form of these groundings; however, we continue to work diligently towards maintaining our capacity plans and driving our future growth.”
The airline’s passenger ticket revenues for the quarter totalled ₹17,157 crore, showing a significant increase of 30.3 per cent, while ancillary revenues reached ₹1,760 crore, a 23.8 per cent rise compared with the same period last year. During the earnings call, the company clarified that ancillary revenues also included compensation from Pratt and Whitney for grounded aircraft.
Operational challenges
CEO Pieter Elbers addressed the operational challenges faced by the airline due to fog in multiple cities. He mentioned, “The latter half of December and January month was characterised by the worst fog that we have probably experienced in many years that led to industry-wide delays and cancellations.”
In terms of financials, total expenses for the quarter ending December 2023 were ₹17,063.7 crore, reflecting a 22 per cent increase over the same quarter last year. The company’s EBITDAR (earnings before interest, tax, depreciation, and rent) witnessed a substantial jump of 61 per cent y-o-y to ₹5,475 crore, compared with ₹3,399 crore a year ago.
Operationally, the ASK (available seat per kilometer) rose nearly 27 per cent y-o-y to 36.5 billion, and the RPK (revenue per passenger kilometer) increased by 28 per cent to 31.3 billion. During the third quarter, IndiGo transported 2.75 crore passengers, indicating a notable 23 per cent y-o-y growth. The load factor during the quarter improved to 85.8 per cent.
Fuel costs increased by 18 per cent y-o-y to ₹6,841 crore, but fuel CASK (cost of available seat kilometer) reduced by 6.7 per cent to ₹1.88 in the reporting period. Yields, meanwhile, rose by 2 per cent to ₹5.48.
As of December 31, 2023, IndiGo reported a robust total cash balance of ₹32,428 crore, comprising ₹19,199.6 crore of free cash and ₹13,228.5 crore of restricted cash. The capitalised operating lease liability was at ₹44,556.5 crore, with the total debt, including the capitalised operating lease liability, amounting to ₹51,187.5 crore.
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