IndiGo, India’s biggest airline, warned capacity will slump by 60% in the three months ending 30 September, as the coronavirus pandemic continues to batter the global aviation industry.
The airline, operated by InterGlobe Aviation Ltd., said in a statement to stock exchanges Wednesday that “the aviation industry is going through a crisis of survival. IndiGo had a total cash balance of ₹18,431 crore as of 30 June, and total debt of ₹23,552 crore”.
“The aviation industry is going through a crisis of survival and therefore, our cash balance remains our number one priority,” said Chief Executive Officer Ronojoy Dutta.
“However, we also recognize that major disruptions offer companies opportunities for improvement in product, customer preference, costs and employee engagement. We have built a strong team which is working on multiple fronts to ensure that we emerge from this crisis stronger than ever.”
The airline’s load factor in the quarter was 61.3% as against 88.9% in June 2019.
Indigo expects Q2 available seat kilometers, an industry term for passenger capacity, at about 40% of year ago period.
The airline on Wednesday reported a net loss of ₹2,844 crore in the quarter ended June compared to a net profit of ₹1,203 crore in the same period of last year.
Revenue from operations plunged 92% year-on-year to ₹767 crore on account of Covid-19 and government orders.
The airline is the biggest customer for Airbus SE’s best-selling A320neo jets. IndiGo is flying only a small percentage of its full fleet of 250 airplanes, its CEO Ronojoy Dutta had said on July 20.
Like many other airlines all around the world, IndiGo is also reducing its workforce and lowering salaries for highly-paid staff. It will consider raising more funds via bonds or shares on Thursday through measures like issuance of equity shares, foreign currency convertible bonds (FCCBs) and non-convertible debentures.