jet airways (india) ltd. presentation to investors
TRANSCRIPT
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February 2008
Jet Airways (India) Ltd.
Presentation to Investors
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Agenda
• Introduction
• Performance estimates
• 9 months ended December 2007
• Outlook
• Update on JetLite performance
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Timeline
IPO: 16x oversubscribedIPO: 16x oversubscribed
1992 1993 1995 2003
Company incorporated
Company incorporated
Commenced air taxi
operations
Commenced air taxi
operations
Granted “Scheduled
Airline” status
Granted “Scheduled
Airline” status
1994 1996 20001997 1998 1999 2001 2002 2004 2005 2006 2007 2008
First to introduce new
generation B737 700s & 800s in India
First to introduce new
generation B737 700s & 800s in India
First purchased
aircraft delivered
First purchased
aircraft delivered
Crossed US$500mn revenues
Crossed US$500mn revenues
First to introduce new
generation B737 900s in
India
First to introduce new
generation B737 900s in
India
First to introduce A330s / 340s in India
First to introduce A330s / 340s in India
Introduced the B777 aircraft/Network of 11 international destinations
Introduced the B777 aircraft/Network of 11 international destinations
Commenced First International Operations to SAARC Countries
Commenced First International Operations to SAARC Countries Acquired Sahara Airlines
Limited as 100% Subsidiary
Acquired Sahara Airlines Limited as 100% Subsidiary
End of Year FY2000 FY2004 FY2005 FY2006 FY2007 Apr-Dec’07
Period End Fleet 29 41 42 53 62 78
Pax carried (Mn) 4.87 6.91 8.14 9.56 10.7 8.26
EBITDAR (US$ Mn) 119 248 320 305 232 137
Started operations to
Gulf
Started operations to
Gulf
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Jet Airways Today
• India’s leading full service carrier
• 78 aircraft fleet: 52 B737, 9 ATR72-500, 8 A330-200, 9 B777-300ER
• 370 flights per day
• 59 destinations (44 in India, 15 abroad)
• More than 10.5 million passengers in 2006-07
• More than 79 million passengers carried till date since inception
• Domestic mkt leader - mkt share-22% (incl. JetLite 30%)
• Publicly listed company, with market cap ~$ 2.0 bn
• Turnover of over $1.7 bn in 2006-07
• Over 12,000 employees
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Performance highlightsApril-December FY08
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Key events year to date• Induction of 9 B777-300ER, 6 A330-200 to the fleet
• Launch of Flights to North America:
• Newark in August 2007
• Toronto in September 2007
• New York (JFK) in October 2007
• Started Dhaka flights (from DEL/CCU) in December 2007
• Upgraded flights to SIN and KUL to A330-200 from December 2007
• Launch flights to Kuwait and Bahrain on 5th January 2008
• Muscat and Doha flights launched on 23rd January 2008
• Codeshare arrangement with Brussels Airlines/ American
• Capacity addition on domestic routes
• Mumbai - Chandigarh, Mumbai - Kochi and Mumbai – Bhopal
• Kolkata – Ahmedabad, Kolkata – Guwahati
• Acquired two new full flight simulators for B777 – 300 ER and Airbus 340 / 330 aircraft for flying training of pilots in October 07
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Jet Airways 22.0%
SpiceJet 10.2%
Go Air 4.3%
Paramount 1.2%
Indigo 9.9%
Kingfisher 13.6%
Air Deccan 15.4%
Indian 16.0%
JetLite 7.4%
Market share Q3 FY08
Source: Press report
Combined 29.0%
Combined 29.4%
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Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07
Seat
s/ m
th (
Mill
ion)
Industry Capacity 9W Capacity
Domestic industry capacity growth
Q3FY08 vs Q3FY07Industry capacity 22%Industry pax 24%
Q3FY08 vs Q3FY079W capacity 1%
9w pax 1%
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* Average revenue per passenger includes Fuel Surcharge and Congestion Surcharge
* ROE used for conversion: 1 USD = INR 39.415 for FY08 and 1 USD = INR 44.26 for FY07
April-December FY08 – Operating Parameters
Apr-Dec 07 Apr-Dec 06 Apr-Dec 07 Apr-Dec 06 Apr-Dec 07 Apr-Dec 06 Var %
Number of Departures 84,830 85,042 7,842 4,551 92,672 89,593 3.4%ASKMs Mio 9,075 9,170 7,687 3,849 16,763 13,020 28.7%RPKMs Mio 6,347 6,439 5,116 2,472 11,463 8,912 28.6%Passenger Load Factor % 69.9% 70.2% 66.6% 64.2% 68.4% 68.4% 0.0%Block Hours 144,755 144,300 45,474 24,935 190,229 169,234 12.4%Revenue Passengers (Mio) 7.24 7.47 1.01 0.55 8.26 8.02 3.0%Avg Gross yield in USD* 135.2 118.4 420.4 319.7 170.2 132.2 28.7%
DOMESTIC INTERNATIONAL TOTAL
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April-December FY08 – Income Statement
* ROE used for conversion: 1 USD = INR 39.415 for FY08 and 1 USD = INR 44.26 for FY07
(USD Million)Apr-Dec 07 Apr-Dec 06 Apr-Dec 07 Apr-Dec 06 Apr-Dec 07 Apr-Dec 06
Total Revenues 1,234.1 1,022.1 479.6 200.8 1,713.7 1,222.8 Of which Op. rev 1,056.2 946.9 479.0 200.8 1,535.3 1,147.7
Total Expenditure 1,163.7 994.1 559.7 244.6 1,723.4 1,238.7 Of which Fuel 364.1 335.9 197.3 88.1 561.4 424.0
(Loss)/Profit before Tax 70.4 28.0 (80.1) (43.8) (9.7) (15.8) PBT (excl. Sale & Lease back) (9.5) (19.5) (80.1) (43.8) (89.6) (63.3)
(Loss)/Profit after Tax 72.0 30.2 (80.1) (43.8) (8.1) (13.6)
EBITDAR 101.0 123.3 35.7 0.5 136.7 123.8 Margin % 9.6% 13.0% 7.4% 0.3% 8.9% 10.8%
DOMESTIC INTERNATIONAL TOTAL
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Balance sheet
* ROE used for conversion: 1 USD = INR 39.415 for FY08 and 1 USD = INR 44.26 for FY07
INR Million INR MillionAs on As on
31-Dec-07 31-Mar-07
I SOURCES OF FUNDS
Shareholders' Funds 21,121 22,373
Loan Funds 101,912 60,563
Deferred payments towards Jet Lite Investments 5,500 -
Deferred Tax Liability 3,175 3,311
TOTAL SOURCES OF FUNDS 131,709 86,246 In USD Million 3,341.6 1,984.0
II. APPLICATION OF FUNDS
Net Fixed Assets: 117,005 72,920
Investments 16,019 689
Current Assets, Loans & Advances 30,722 33,645
Less: Current Liabilities & Provisions 32,038 21,008
Net Current Assets (1,315) 12,637 Profit & Loss Account
TOTAL APPLICATION OF FUNDS 131,709 86,246 In USD Million 3,341.6 1,984.0
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Sector-wise seat factorsSector Q1 FY08 Q2 FY08 Q3 FY08 Apr-Dec'07
SAARC MAA-CMB-MAA 54.3 66.5 64.3 61.8 DEL-KTM-DEL 93.6 93.5 83.2 89.3 CCU-DAC-CCU - - 36.8 36.8 DEL-DAC-DEL - - 34.2 34.2 SAARC Total 77.0 82.0 73.2 77.0
ASEAN BOM-SIN-BOM 78.2 73.6 80.1 77.3 MAA-KUL-MAA 84.3 82.9 78.7 81.9 MAA-SIN-MAA 80.6 73.4 68.7 74.1 DEL-SIN-DEL 66.2 79.5 82.0 76.2 DEL-BKK-DEL 73.2 73.2 85.7 77.4 CCU-BKK-CCU 44.7 48.7 77.6 57.1 ASEAN Total 72.7 73.8 79.2 75.3
UK BOM-LHR-BOM (117/118) 67.6 68.0 65.5 67.0 BOM-LHR-BOM (119/120) 58.8 59.8 57.0 58.5 DEL-LHR-DEL 57.9 68.9 68.6 65.2 ATQ-LHR-ATQ 73.3 81.7 80.2 78.0 AMD-LHR-AMD 54.6 57.5 52.9 55.0 UK Total 62.5 66.1 63.7 64.1
US BOM-BRU-EWR-BRU-BOM - 65.5 71.0 68.9 MAA/DEL-BRU-YYZ-BRU-DEL/MAA - 58.6 61.6 60.9 DEL-BRU-JFK-BRU-DEL - - 57.3 57.3 US Total 64.2 64.5 64.4 TOTAL 65.6 67.5 66.4 66.6
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Outlook
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Outlook• Domestic:
– Industry expected to lose over USD 500 mio this fiscal year
– No more All-India licenses being granted by DGCA
– Three rounds of consolidation in the industry
– Carriers have begun to spread out their delivery schedules
– Focus likely to gradually shift from race for market share to
cost control, optimization of utilization and profitability
– This could bring some rationality in yields
– Structural changes in operating costs will help further:
• Potential reduction in Taxes/ duties on ATF
• Entry of private players in ATF distribution
• Potential changes in the commission structure
– Crude oil prices could spoil the party
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Outlook
• International:
– Will grow to be 50% of the business by FY 2010
– By FY 2010, all major routes will be profitable
– Flights to the Gulf will provide a major impetus
– Initial response to the US and Gulf flights very encouraging
– In dialogue with US carriers and others to increase network
presence through Code shares and cooperation agreements
– With additional routes, we achieve better productivity in terms of
Unit cost per ASKM.
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Jet Airways fleet plan
• In addition, Jet has firm orders for 20 B737, 10 B787 and 10 B737 option aircraft between FY 2012 – 2014
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89
1418
20
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12
1317
10
10
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40
60
80
100
120
140
Mar'07 Mar'08 Mar'09 Mar'10 Mar'11
No
of A
ircra
ft
BOEING 737s ATR A340-300/A330s B777-300ER
81
62
92
106117
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JetLite (India) Limited
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In Fleet: 17 Boeing and 7CRJsAs At Boeing
FlyingBoeing
On groundCRJ
FlyingCRJ
On ground20/04/07 12 5 2 5
30/06/07 14 3 3 4
30/09/07 15 2 3 4
31/12/07 16 1 4 3
31/03/08 * 17 0 5 2
Fleet status
* - Proposed
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• Increase in daily capacity by 16.4% seats in Q3 as compared to Q2
• Increased market share from 6.9% in Q2 to 7.4% in Q3
• Average seat factor for the 9 months above 70%
• Cost per ASK maintained at INR 3.1 despite higher fuel costs
• Cost per ASK w/o fuel lower by~7.5%.(Unit cost reduction of 27.7%
over FY 07)
• Reconfiguration & rebranding exercise in progress
• Applied for rights to operate to Gulf & Thailand; expect approvals
soon
Updates - Network/ Fleet/ operations
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Operating parameters April-December FY08
* Average revenue per passenger includes Fuel Surcharge and Congestion Surcharge* ROE used for conversion: 1 USD = INR 39.415 for FY08
Traffic ParametersDOMESTIC INTERNATIONAL TOTAL
Number of Departures 28,891 1,244 30,135 ASKMs Mio 3,971 256 4,227 RPKMs Mio 2,842 169 3,011 Passenger Load Factor % 71.6% 66.1% 71.2%Block Hours 54,127 2,737 56,863 Revenue Passengers (Million) 2.32 0.13 2.46 Revenue per RPKM in INR 3.40 4.07 3.44 Cost per ASKM in INR 3.12 2.80 3.10 Break Even Seat Factor (%) 91.8% 68.8% 90.2%Cost per ASKM in INR w/o Fuel 1.71 1.87 1.72 Break Even Seat Factor (%) w/o Fuel 50.2% 46.0% 50.0%
Average Gross revenue per passenger in INR* 4,460 5,513 4,517 Average Gross revenue per passenger in USD* 113 140 115 Average Net revenue per passenger INR* 4,161 5,148 4,214 Average Net revenue per passenger USD* 106 131 107 Period end Fleet size 23 1 24 Average fleet size during period 18 1 19 Aircraft Utilisation - - 8.6
APR-07 TO DEC-07
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Income statement April-December FY08
* ROE used for conversion: 1 USD = INR 39.415 for FY08
Figs in INR Mio
ParticularsDOMESTIC INTERNATIONAL TOTAL
INCOMEOperating Revenues 10,772 747 11,519 Non Operating Revenues 60 1 61 Total Revenues 10,832 748 11,581 IN USD Mio 274.8 19.0 293.8
EXPENDITUREEmployees Remuneration & Benefits 1,379 91 1,470 Aircraft Fuel Expenses 5,619 238 5,857 Selling & Distribution Expenses 1,134 72 1,206 Other Operating Expenses 3,338 258 3,597 Aircraft Lease Rentals 1,922 106 2,028 Depreciation 58 4 62 Interest 137 7 144 Total Expenditure 13,587 776 14,363 IN USD Mio 344.7 19.7 364.4
PROFIT BEFORE TAXATION (2,755) (28) (2,782) IN USD Mio (69.9) (0.7) (70.6)
EBITDAR (697) 87 (610) IN USD Mio (17.7) 2.2 (15.5) Margin % -6% 12% -5%
APR-07 TO DEC-07
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JetLite fleet plan
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7
910
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5
10
15
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25
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35
40
Mar'07 Mar'08 Mar'09 Mar'10 Mar'11
No
of A
ircr
aft
B 737 CRJ / Regional Ac
242427
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36
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Thank You
Disclaimer
Certain statements in this release concerning Jet Airways’ future growth prospects are forward-looking statements, which involve a
number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The
risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in
earnings, our ability to manage growth, intense competition in the aviation business including those factors which may affect our cost
advantage, wage increases, our ability to attract and retain professionals, time and cost overruns on various parameters, our ability to
manage our international operations, liability for damages, withdrawal of governmental fiscal incentives, political instability, legal
restrictions on raising capital, and general economic conditions affecting our industry. Jet Airways may, from time to time, make additional
written and oral forward-looking statements, including our reports to shareholders. Jet Airways does not undertake to update any forward-
looking statement that may be made from time to time by or on behalf of the company.