IndiGo Q3 Profit Doubles to Rs 2,998 Cr, 70 Planes Grounded

New Delhi, Feb 2 (PTI) Remaining profitable for the fifth straight quarter, the country's largest airline IndiGo on Friday reported more than doubling of its profit after tax to Rs 2,998.1 crore in the 2023 December quarter while more than 70 planes of the carrier are grounded due to Pratt & Whitney engine issues.

Helped by higher capacity and increased passenger traffic, InterGlobe Aviation, the parent of IndiGo, saw its profit after tax jump in the third quarter of the current fiscal from Rs 1,422.6 crore in the year-ago period.

Excluding foreign exchange loss, the company's profit stood at Rs 3,049.1 crore in the latest quarter under review compared to Rs 2,009.1 crore in the same period a year ago, according to a release.

The company's total income in the third quarter of the current fiscal rose to Rs 20,062.3 crore from Rs 15,410.2 crore in the same period a year ago.

"For the third quarter of financial year 2024, we reported a profit after tax of 30 billion rupees 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," IndiGo CEO Pieter Elbers said.

During an earnings call, IndiGo CFO Gaurav M Negi said the current number of aircraft on the ground is in the mid-70s, which is a slight improvement from our earlier estimate.

"We hope the situation will start to improve in a few quarters from now," he said and stressed that mitigation measures taken have helped in managing the situation.

The airline had a fleet of 358 aircraft, including 31 A320 ceos (11 damp lease), 184 A320 neos, 94 A321 neos, 44 ATRs, 3 A321 freighters and 2 B777s at the end of December 2023.

"The number of AOGs (Aircraft on Ground) because of the powder metal issues we have, has increased starting January. So, the averages of groundings we had in the third quarter of around high 40s has now gone up to 70s... as we bring in more damp leases, the impact is going to get mitigated," Negi said.

Many IndiGo planes, powered by Pratt & Whitney engines, are being subject to inspection due to powder metal issues with the engines.

Elbers said mitigating measures, including continuing to work on spare engines, are being taken.

"We are also strategically optimising our network... Going forward, we are optimising our resources to meet the robust demand for air travel and drive profitable growth despite supply chain constraints," Negi said.

For the December quarter, IndiGo said, "Our passenger ticket revenues were Rs 171,572 million, an increase of 30.3 per cent and ancillary revenues were Rs 17,600 million, an increase of 23.8 per cent compared to the same period last year".

In the December quarter, capacity increased by 26.8 per cent while the number of passengers rose by 23.4 per cent to 27.5 million.

"Yield increased by 2.0 per cent to Rs 5.48 and load factor improved by 0.7 points to 85.8 per cent," the release said.

In the fourth quarter, the airline expects a capacity growth of 12 per cent.

At the end of December 2023, the airline's total cash balance was at Rs 32,428 crore comprising Rs 19,199.6 crore of free cash and Rs 13,228.5 crore of restricted cash.

"The year 2023 was marked by numerous milestones. We served 100 million plus passengers in a calendar year and joined the select club of global carriers operating at this scale. We started operating 2,000 plus daily flights to 118 destinations," Elbers said in the release.