Jet Airways narrows operating loss despite high fuel costs

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India's Jet Airways posted a consolidated operating loss of Rs2.5 billion ($45 million) for the fiscal year 2013, a significant improvement over its Rs9.7 billion operating loss in FY2012.

In results released last week for the year ended 31 March, Jet continued to suffer from high fuel prices. Its consolidated fuel bill rose by 3.5% to Rs80 billion and comprised nearly half of its total expenses of Rs191 billion.

Jet's consolidated numbers include that of parent Jet Airways and low cost unit JetKonnect, formerly known as JetLite.

Jet Airways' standalone RPKs for the year fell to 29.5 billion compared with 30.6 billion in 2012. Its load factor fell by 0.5 percentage points from the previous year to 78.8%.

JetKonnect's load factor fell by 3.1 percentage points year on year to 74.8% in 2013.

"A sluggish economic scenario and high yields have resulted in a decrease in market demand and capacity," says acting chief executive Hameed Ali. "Rupee depreciation, high fuel prices, increases in landing and navigation costs, and increased costs of operations have impacted the quarterly results."

Jet specifically pointed out its cost of having "aircraft on ground" during the year, which amounted to Rs1.9 billion.

Looking forward, the carrier says a tie-up with Etihad will help improve costs and provide synergies in areas such as fleet acquisition, maintenance and joint purchasing, crew training, and loyalty programmes.

"The alliance will bring significant guest benefits with expanded codesharing, creating a combined network of 140 destinations," it says.