However, the loss was less than that of September quarter when it had touched Rs 468.66 crore. Cumulative losses for this financial year have gone up to Rs 1,176.50 crore. A statement from Kingfisher said its net worth (paid-up equity plus reserves) ‘has been completely eroded’. The losses have mounted despite Kingfisher shrinking its fleet during the period to 64 and adopting other cost reduction measures such as 15 per cent fewer departures at 24,110. A statement from the company attributed the losses to the “steep depreciation of rupee coupled with consistently high crude prices."
Fuel costs of the company increased 37 per cent on a year-on-year basis to Rs 739 crore during the period. Lease rentals mounted to Rs 272.24 crore for the period, up 11.45 per cent over the corresponding period of the previous year.
Kingfisher's financial troubles have resulted in deferring its entry into the global alliance, OneWorld. Besides it was still grappling with its finances as many banks have classified the account as non-performing assets and they are reluctant to go ahead with a second round of debt restructuring. The first round of restructuring was done in March 2011, as a result of which banks hold about 23.5 per cent of the company's equity.
A second round debt restructuring has been made contingent to the promoters bringing in more equity into the company. Kingfisher has been in talks with several investors, including foreign airlines. Bankers though have turned down any proposal that entailed conversion of any more debt into equity. Kingfisher has opened talks with SC Lowy Financial, a Hong Kong-based distressed debt firm, in a sign it may be running out of traditional funding options. On the revenue side, Kingfisher's income shrank 19 per cent to Rs 1,342 crore during the quarter.
Passenger load factor, or utilisation of aircraft, was down to 75.2 per cent from 84 per cent the same period previous year. Revenue passengers dropped 16 per cent to 2.34 million in the face of cutthroat competition in the industry that has also seen its nearest competitors, Jet Airways and SpiceJet, slip into losses of Rs 101 crore and Rs 39 crore, respectively.