Cash-strapped Jet Airways, reported a whopping Rs 1,323 crore of net losses for the June quarter last night stating higher fuel cost, falling rupee and low fares as the cause. After its board meeting yesterday, it said that it will monetise its loyalty programme JetPrivilege and wet-lease some of its small aircraft to mobilise urgent working capital.

For the year-ago period, the Naresh Goyal-run airline booked a net profit of Rs 53.50 crore and a net loss of Rs 1,036 crore in the previous quarter (March 2018). This is the carrier's second straight quarterly loss.

The airline said its fuel cost soared 53 percent to Rs 2,332 crore in the quarter, while low fares had revenue inching up to Rs 6,066 crore from Rs 5,953 crore. The second back-to-back quarterly loss forced Jet Airways, which delayed the result announcement on August 9 indefinitely, to announce a turnaround plan which, according to chairman Goyal, includes a capital infusion by selling a stake in JetPrivilege, and a massive cost-cutting to save around Rs 2,000-crore over the next two years.

"The board today considered two significant proposals: infusion of capital and monetisation of the airlines' stake in the loyalty programme," Goyal said. It can be noted that the airline owns 49.9 percent in JetPrivilege and the rest is with its equity partner Etihad, which owns 24 percent stake in the airline.

Jet airways in its press release informed the following 'key decisions of turnaround strategy':

1. Comprehensive cost reduction programme: Will result in an excess of INR 2,000 crores of cost reduction over the next two years. The cost reduction programme covers various facets of the company's operations including Maintenance costs, Selling and Distribution costs, Fuel rate and optimization, Debt and Interest cost reduction and enhancement of Crew and manpower productivity.
2. Induction of fuel and cost-efficient B737 MAX aircraft: Contributing to the stated 8-10% growth plan.
3. Revenue enhancement programme: Delivering 3-4% growth in RASK through tactical and strategic initiatives around network, pricing, inventory management and sales.
4. Product and service improvements: Provide choice and flexibility to guests in line with global best practices and standards.
5. Leveraging the well-established 8.5m member JetPrivilege programme
6. Balance sheet restructuring: Capital infusion and debt reduction to result in significant reduction in the interest cost.
7. Fleet simplification: Wet lease of excess ATR aircraft and simplification of sub-fleet complexity of B737s to result in further improvements to the bottom line.

Shares of Jet Airways were trading higher from the previous close in the morning hours, despite the giant loss reported last night.