Kingfisher Airlines Q3 net loss widens as costs rise

Kingfisher Airlines, the Vijay Mallya owned cash-strapped airline, reported a 75 per cent wider net loss at Rs 444.26 crore for the quarter ended December 31, 2011, due to high fuel costs, a weaker rupee and fierce competition.


The carrier had reported a net loss of Rs 253.69 crore in the corresponding quarter last year, it said in a regulatory filing to the Bombay Stock Exchange (BSE).

Income from operation also declined to Rs 1,342.32 crore in the quarter ended December 31, 2011 from Rs 1,583.43 crore in the same period last fiscal, it said.

Debt-laden Kingfisher is around a quarter-owned by banks and its top lender State Bank of India (SBI) has refused to add to loans it considers non-performing.

"Steep depreciation of the Indian rupee coupled with consistently high crude oil prices has led to a challenging quarter for the Indian aviation industry," Kingfisher said.

However, shares of the company were trading nearly 3 per cent higher at Rs 27.55 on BSE during the morning trade.

The private carrier is in a financial mess and struggling to service its loans, which have run up to over Rs 6,000 crore.

The company is in talks with distressed-debt experts but there are no signs of a guardian angel equity injection that executives have long promised. An entry into the potentially lucrative oneworld alliance was postponed this month as it scrambles for capital.

Unpaid staff have left in droves, and scores of flights have been cancelled to cut costs. Turboprop maker ATR, a joint venture of EADS and Finmeccanica, cancelled 38 plane orders from Kingfisher in January because the airline hadn't paid for the planes.

Kingfisher, named after India's most famous beer owned by its parent company, has grounded planes for safety shortcomings and faced immense investor scrutiny on its plans to revive the airline.

With inputs from agencies