IndiGo has cited mixed market dynamics between the two halves of the year ended 30 March as it reported a Rs1.5 billion ($21.6 million) loss before tax.
The result is a contrast to the pre-tax profit of Rs31 billion for the previous year.
Revenue for the full year rose 24% to Rs298 billion, despite a 2% fall in RASK to Rs3.57 as ASKs increased 28%.
Total expenses, meanwhile, increased 44% to Rs300 billion, pushing CASK including fuel up 14% to Rs3.59.
Net profit slumped from Rs22.4 billion to Rs1.56 billion. Total cash at the end of March amounted to Rs153 billion, up from Rs137 billion at the same time last year.
“Fiscal 2019 was a tough year for the airline industry in India because of high fuel prices, weak rupee and intense competitive environment,” says chief executive Ronojoy Dutta. “However, it is a tale of two halves for IndiGo, with the first half of the year incurring losses and the second half of the year experiencing a sharp recovery.”
That recovery was evident in its results for the three months to 31 March as its pre-tax profit almost quadrupled to Rs6.17 billion, as revenue surged 36% to Rs82.6 billion.
Yield during the quarter improved 12%, despite load factor falling three points to 86%. That was largely due to a 29.4% increase in ASKs, outpacing the 25% rise in RPKs.
Dutta commented that during the last quarter, the airline saw an underlying unit revenue improvement of around 5% from internal initiatives, while the demise of competitor Jet Airways delivered a 3-4% improvement in the same metric.
“By May, however, as the industry has added capacity to Jet markets, the Jet Airways effect has started to dissipate and by June I think the effect will pretty much disappear except in a few international markets where we overlapped with Jet as in the Middle East markets,” he adds.
Dutta says that the first quarter of the 2019/20 fiscal year was “off to a good start”, but cautioned that the airline had little visibility over the seasonally weaker second quarter.
“The shape of the second quarter will depend a lot on whether the new capacity finds traction in the market place and if pricing discipline is maintained,” he adds.
Despite that, it has forecast that for both the quarter ending June 2019 and the full year that ASKs will increase 30%.