How can Spice Jet sustain its market share in upcoming competition?

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How can Spice Jet sustain its market share in upcoming competition?

30 November, 2014,South Asia, USA NEWS CORP

Sky is fast growing market in South Asia. Aviation sector is shifting here towards low cost maintenance. High running cost will eliminate potential players from market. Customers are looking for affordable service providers, while operating cost is increasing day by day with increased pressure from competitors. Low air fares and high quality services both are still in demand.

SpiceJet announces Q2FY15 results (covering July – Sept 2014):
Year-on-year capacity up 7%, revenues up 15%, expenses down
2%, and losses reduced by 45% as turnaround efforts gain ground
SpiceJet is pleased to report significant year-over-year improvement in operating
performance and reduction in losses in Q2FY15 relative to Q2FY14, in what is traditionally
the weakest quarter of the year for aviation in India.
Performance Summary on year-on-year basis (additional details in charts below):
1. Capacity (Available Seat Km) up 7% and RPK (Revenue Passenger Km) up 28%
2. Total revenues up 15% (passenger revenues up 18%, ancillary revenues up 31%), and
Total expenses down 2%
3. Load Factor up 19%, Total RASK (Revenue per Available Seat Km) up 12%, and Total
CASK (Cost per Available Seat Km) down 7%
4. Year-over-Year net loss reduced by 45% in Q2FY15, from Rs 559.5cr in FY14 to
310.4cr in FY15 (an improvement of Rs 249cr)
5. There were Rs 75cr of one-off & restructuring expenses in the quarter. Excluding
these expenses, Year-on-Year loss reduced by 57% ( or 313.9cr); EBITDAR margin
improved from -19% to +4% YoY (an improvement of Rs 283.6cr)
6. Positive impact of YoY improvement in exchange rate and fuel price was Rs 29cr.
Q2FY15 did not have the benefit of recently introduced ATF price reductions that
came into effect in October and November.

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