IndiGo Q1 net loss widens to Rs 3,174 crore; misses Street estimates

InterGlobe Aviation-owned IndiGo airline’s June quarter (Q1FY22) net loss widened at Rs 3,174.2 crore on Tuesday amid a triple whammy of muted air traffic, oil prices rise, and depreciation of the rupee depreciated.

The airline had posted a net loss of Rs 1,160 crore in Q4FY21 and Rs 2,849.4 crore in the previous-year period.

“During the current quarter, the country was under a severe impact of second wave of Covid-19. As a result, all state Governments reintroduced measures including lockdown to curtail spread of the virus. This has led to a significant drop in air traffic thereby severely impacting our revenues and profitability for the quarter,” the company said in a statement.

The company’s bottom line missed Street expectations that had built in a net loss in the range of Rs 2,500-2,700 crore. READ HERE

Operationally, the budget carrier’s revenue declined 51.6 per cent at Rs 3,006.9 crore during the quarter under study compared with revenue of Rs 6,223 crore clocked in the March quarter. That said, it was higher than Rs 766.7-crore revenue reported last year.

Source: IndiGo’s investor presentation

Moreover, it reported an ebitdar (earnings before interest, tax, depreciation, amortisation, and rent) loss of Rs 1,360.2 crore compared Rs 1,421.2 crore last year. Ebitdar margins stood at 45.2 per cent.

The company’s fuel costs (per litre) jumped 67.3 per cent on a YoY basis.

Cash and Cash balance

At the end of the June quarter, IndiGo’s free cash balance stood at Rs 5,620.7 crore, down from Rs 7,527.6 crore in the year-ago period. It’s restricted cash flow, meanwhile, was at Rs 11,447.2 crore, up 5 per cent YoY, from Rs 10,922.2 crore.

Total debt ballooned to Rs 31,690.1 crore from Rs 23,551.6 crore reported last year.

“IndiGo’s balance sheet continues to remain strong with sufficient liquidity as of 30 June 2021. We remain focused to reduce our unit costs and place stringent controls on all discretionary spends and capital expenditures. We continue to engage with various lenders for additional financing arrangements, should there be a need in future, and will take necessary actions that strengthen our cash position,” the company said.

It added: We have a strong cash position as of June 30, 2021 and hold our current investments in highly liquid funds and bank fixed deposits. We have met and expect to meet all our ongoing cash obligations pertaining to lease rentals, debt repayments and any other financial obligations. Through this period of uncertainty, we will continue to monitor, any material changes to future economic conditions impacting our financial position.

Ahead of the result, the scrip of IndiGo settled 1.88 per cent lower at Rs 1,707 apiece on the BSE.

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