Debt-ridden SpiceJet has reported net profit for the second consecutive quarter, showing signs that the budget carrier is on poised to make a turnaround in its operations.
The Gurgaon-based airline posted a profit of Rs 71.80 crore for the first quarter of the current fiscal year, compared to a loss of Rs 124.1 crore in the same period last year.
SpiceJet, India's fourth-largest airline by market share, had earned a profit of Rs 22.5 crore in the March quarter against a loss of Rs 322 crore in the same quarter last year.
"This is the second consecutive profitable quarter and I am proud of what we have achieved. But there is still a long way to go. I am confident that the best is still ahead of us," said SpiceJet Ltd Chairman Ajay Singh in a statement.
Following the upbeat quarterly earnings, share prices of SpiceJet rose more than 5% on Tuesday, to close at Rs 26.60 on the Bombay Stock Exchange (BSE).
The company was also able to reduce its costs by 42% in the quarter ended June 2015.
"The return to profitability in Q4FY15, and the achievement of the best ever Q1 results in our history in Q1FY16, are achievements that even our most hardened naysayers will acknowledge as remarkable", said Sanjiv Kapoor, Chief Operating Officer, SpiceJet Ltd.
However, the company's revenue was down 34% in the June quarter against the same quarter a year ago, owing to a reduction in its fleet.
The struggling carrier was on the verge of collapse before an ownership change in January this year. The company's board decided to transfer control from the Marans to founder-promoter Ajay Singh, after which Singh acquired the entire 58.4% stake held by the Marans.
Under the restructuring plan, Singh is expected to infuse Rs 1,500 crore to turnaround the loss-making airline. SpiceJet has already received Rs 650 crore under the new revival plan.