Interglobe Aviation Ltd, which runs India’s largest airline IndiGo, reported the steepest quarterly loss in at least five years on Wednesday as travel restrictions due to the COVID-19 pandemic hit its operations.
A more than two-month long lockdown that started in March to curb the spread of the pandemic forced the airline to halt its operations, adding to its woes as it was already grappling with higher maintenance costs and weak demand.
The airline said it expects second-quarter average seat kilometers (ASKs) to be around 40% of its ASKs for the same quarter a year earlier.
“The aviation industry is going through a crisis of survival,” Chief Executive Officer Ronojoy Dutta said in a statement.
First-quarter net loss came in at 28.49 billion rupees($381.31 million), compared with a profit of 12 billion rupees a year earlier. Analysts had forecast a loss of 22.63 billion rupees, according to Refinitiv.
Indigo, which dominates the domestic market, said total debt as of June stood at 235.52 billion rupees, up nearly 28% from a year earlier.
The company said earlier this month it will cut 10% of its workforce to save costs.
In June, IndiGo said it would cut up to 40 billion rupees in costs and speed up the return of older planes to leasing companies in an attempt to cope with the hit to business as a result of the pandemic.
India in May allowed domestic airlines to start a third of their operations after a two-month shutdown, but the pandemic continues to hit demand for air travel.
Revenue from operations plunged 92% to 7.67 billion rupees in quarter ended June 30, the company said.