Air India continues to fly high, clocks vastly improved results
Air India, which turned operationally profitable last fiscal, reported an operational loss of Rs 246.14 crore in the three months ended June 2016.
The operating loss in the first quarter of this financial year has come down from Rs 315.37 crore in the year-ago period, Minister of State for Civil Aviation Jayant Sinha informed the Lok Sabha on Thursday.
“The target fixed by Air India for operating profit for the first quarter of 2016-17 was Rs 87.28 crore against which the company has posted an operating loss of Rs 246.14 crore in the first quarter of 2016-17,” he said in a written reply to the Lok Sabha.
Sinha said the main reason for operating loss was the decline in “revenue yields by around six per cent over the budgeted target resulting in decline in passenger revenue”.
Besides, there was a fall in cargo revenue compared with budgeted estimates.
“The first quarter of the financial year is a lean traffic season for domestic aviation traffic and the same picks up only in the second half of the year during which the company will be aiming at achieving an overall operating profit,” Sinha said.
Under the turnaround plan, the airline is projected to see an operating profit of Rs 1,086 crore in 2016-17. During the same period, net loss and revenues are expected to be Rs 1,989 crore and Rs 22,206 crore, respectively, as per the provisional figures.
For the first time in nearly a decade, Air India reported an operating profit of Rs 105 crore in the last fiscal.
According to Sinha, the airline has been facing losses in the past few years on account of a multitude of factors. These include high interest burden and airport user charges, adverse impact of exchange rate due to weakening of the rupee, increase in competition, especially from low cost carriers and liberalised bilaterals to foreign airlines, he added.
As part of the turnaround plan, the minister said that till date, Rs 23,933 crore has been released as equity support to Air India.
AAI: airports can have temporary currency exchange system
National airports operator AAI on Thursday said it will allow scheduled commercial banks to operate temporary currency exchange counters at aerodromes as people still face difficulties in the wake of demonetisation of notes. “Decision of the Government of India to demonetise the currency across the nation has led to currency hardships for airport users and air travellers,” AAI said in a release.