Grounded private airline Jet Airways, which is currently undergoing insolvency proceedings has reported a loss of Rs 5,535.75 crore for FY19. This is a significant increase from the loss of Rs 766.13 crore it reported for FY18. Jet Airways, which suspended operations in April 2019, reported its financial results for FY19 over a year later. The airline's total income declined to Rs 23,314.11 crore from Rs 23,958.37 crore in the year-ago fiscal, a decline of 2.6%.
The widening loss has been a result of increasing expenses. The company reported total expenses of Rs 28,141.61 crore as against total expenses of Rs 24,725.99 crore in FY18, an increase of nearly 14%. Of the total expenses, ‘other expenses’ saw most increase from Rs 817 crore in FY18 to Rs 9,821 crore in FY19. Meanwhile, the cost for fuel went up by 24.8% to Rs 8,680 crore in the year ending March 31, 2019, while finance cost increased significantly, by 16.5% in the year to Rs 981 crore.
The net worth of Jet Airways at the end of March 31, 2019, stood at a negative Rs 12,695 crore. These are the earnings of the company on a standalone basis.
The company’s resolution professional Ashish Chhawchharia said in the regulatory disclosure that the financial statements of the company for FY19 pertains to period prior to commencement of the corporate insolvency resolution proceedings (CIRP). All the directors of the Company, CEO, CFO and Company Secretary had resigned from their respective positions in the Company, prior to commencement of the CIRP.
“In the absence of the Chief Financial Officer, Company Secretary and other officials who were primarily responsible for book closure process and financial reporting, the Resolution Professional and the employees who were part of Asset Preservation Team (APT) have made all practical and reasonable efforts from time to time to gather details to prepare these financial statements, despite various challenges and complex circumstances, have tried to put in best possible efforts to provide information required by the auditors for the purpose of carrying out the audit of the financial statements of the Company,” he said in a Bombay Stock Exchange filing.
He also said that he is not in a position to provide the consolidated financial results, as the subsidiaries of the company are separate legal entities, also currently non-operational. “The RP is facing huge difficulty in obtaining relevant data from the said subsidiaries,” he added.
The company, which went into insolvency proceedings last year, received resolution plans from two bidders last week.
These bidders were shortlisted in the fourth round of inviting bids. The first bidder is a consortium of UK-based financial advisory company Kalrock Capital and a UAE-based entrepreneur Murari Lal Jalan. The second bid has come from a consortium of Haryana-based Flight Simulation Technique Centre, Mumbai-based Big Charter and Abu Dhabi-based Imperial Capital Investments LLC.
Jet’s resolution professional Ashish Chhawchharia told TNM last week that the resolution plans submitted by both bidders will be reviewed to see how viable they are and ensure they comply with Insolvency and Bankruptcy Code (IBC), this will be followed by negotiations with lenders and should that work out, there will be an approval. This process is likely to take around a month.