Interglobe Aviation (IndiGo) Q3 Results: From fuel prices to weak rupee, what all played spoilsport to nosedive profit massively by 75%

IndiGo Q3 Results: The largest airline in terms of market share - Interglobe Aviation (Indigo) on Wednesday presented its December 2018 (Q3FY19) result, which surprisingly was not a good one. Indigo's net profit came in at Rs 190.9 crore which nosedived massively by 75% compared to the profit of Rs 762 crore a year ago same period. Even operating profit (EBIDTA) of Indigo plunged by 16% to Rs 1,681.4 crore in Q3FY19 versus Rs 2,001.9 crore in Q3FY18. EBITDA margin during the quarter stood at 21.2% as against 32.4% in Q3FY18. 

For weak Q3FY19 profitability, Indigo blamed high fuel prices and currency depreciation.

Rahul Bhatia, interim CEO of Indigo said, "Looking at this last quarter, I would like to make the following points - We have posted a profit of INR 1.9 billion in a continued difficult environment and have grown our fleet by one aircraft a week for a 33% capacity increase for the quarter. Very few airlines around the world have the operational resilience to absorb such rapid growth and I want to thank all our employees for being up for this challenge."

Bhatia added, "Just as importantly, we find that the markets we serve are responding very positively to this new capacity. That is evidenced by the fact that after  continued weakness in October which pulled our overall quarterly performance, our RASK numbers have improved in November and December."

On the other hand, Indigo's revenue from operations stood at Rs 7,916.2 crore in Q3FY19, rising by 28.1% from Rs 6,177.9 crore in the corresponding period of the previous year. Total income for the quarter ended December 2018 was Rs 82,294 million, an increase of28.4% over the same period last year.

It was revenue from passenger tickets which continued its stellar performance for Indigo. 

For the quarter, passenger ticket revenues were Rs 7,065.9 crore, an increase of 32.8% and ancillary revenues were Rs 8,051 million, an increase of 15.0% compared to the same period last year. 

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Meanwhile, expenses also saw sharp increase in Q3FY19. Indigo's total expense was at Rs 8,038.5 crore up by 50.6% over same quarter last year. 

Indigo in its financial audit report said, "CASK excluding fuel was INR 2.04, an increase of 6.3% over the same quarter last year. Our CASK excluding fuel was majorly impacted by the adverse movement in foreign exchange in the quarter. Excluding the impact of currency depreciation, our CASK excluding fuel decreased by 0.4% over the same period last year."

As on December 2018, IndiGo had a total cash balance of Rs 14,136.1 crores comprising of Rs 4,618.3 crore free cash and Rs 9,517.8 crore of restricted cash. 

Total debt was at Rs 2,475.9 crore. The entire debt for IndiGo is aircraft related.

For the period October-December 2018, the Company had a Technical Dispatch Reliability of 99.87%, on-time performance of 79.1% at four key metros and flight cancellation rate of 0.45% 

Operated a peak of 1,336 daily flights including international operations during the quarter. Service to 64 destinations including 15 international cities; added 6 international and 1 domestic destination during the quarter.

Going forward, Indigo expects fourth quarter fiscal 2019 year-over-year capacity to increase by 34% in ASKs.

On BSE, the share price of Indigo finished at Rs 1,110.40 per piece, down by Rs 7.50 or 0.67%.