Interglobe Aviation Ltd · NSE:INDIGO

Interglobe Aviation — Investor Presentation (December 2019)

15 slides from Interglobe Aviation's investor presentation, Dec 4, 2019

  1. Slide 1: Regulation 30 disclosure cover letter

    December 4, 2019 To, The Managing Director, National Stock Exchange of India Limited, Exchange Plaza, C- 1, Block G, Bandra Kurla Complex, Bandra - (€), Mumbai - 400 051 Symbol : INDIGO Dear Sir, IGAUSECT/12-19/03 To, The General Manager, Department of Corporate Services, BSE Limited, Phiroze Jeejee

  2. Slide 2: Company Presentation December 2019

    Company Presentation December 2019

  3. Slide 3: Disclaimer

    Disclaimer The information contained in this presentation is provided by InterGlobe Aviation Limited (the “Company”) to you solely for your reference. This document is being given solely for your information and for your use and may not be retained by you and neither this presentation nor any part t

  4. Slide 4: Agenda

    Agenda: • Understanding Q2 Cost Increase • Drivers of our underlying cost structure • Update on NEO engines • Q3 Outlook 3

  5. Slide 5: Understanding Q2 cost increase

    Understanding Q2 cost increase CASK ex fuel (INR) 2.56 2.18 17.2% Increase in CASK ex Fuel MTM loss on capitalized leases 8.1% Q2 FY19 Q2 FY20 Fuel CASK (INR) Maintenance Cost* 6.0% 1.56 17.3% 1.29 Employee Cost 3.3% Q2 FY19 Q2 FY20 CASK (INR) Lower Aircraft Utilization 2.7% 3.74 2.8% 3.85 *Re-asses

  6. Slide 6: Drivers of cost - Maintenance Cost

    Drivers of cost - Maintenance Cost* Maintenance cost / ASK (INR) 0.63  INR 3.2 billion provided as a result of the re- 0.13 assessment of accrual estimates for heavy 0.42 51.7% maintenance and overhaul cost of older CEO engines 0.50  These costs will go away as CEOs are redelivered Q2 FY19 Q2 FY20

  7. Slide 7: Drivers of cost - Employee Cost

    Drivers of cost - Employee Cost Employee Cost/ ASK (INR) 25.5% The additional cost related to Agile* 0.50 has an offset in 25.5% 0.40 9.6% other expenses We gave 7.6% employees a pay hike Q2 FY19 Q2 FY20 8.3%  ~600 additional pilots hired post Jet grounding Others (primarily Agile)  Carrying addit

  8. Slide 8: The Fuel Story

    The Fuel Story INR Fuel CASK vs ATF prices INR/ Litre 1.80 80 1.56 1.60 70 1.29 1.40 60 1.20 ATF price reduction - 8.7% Fuel CASK reduction - 17.3% 50 1.00 40 0.80 70 64 30 0.60 0.40 20 0.20 10 0.00 0 Q2 FY19 Q2 FY20 IOCL ATF prices* Fuel CASK • Invested heavily to reduce fuel consumption • Market v

  9. Slide 9: Status of significant cost drivers

    Status of significant cost drivers Key Drivers Status Pilot Costs Temporary A320 CEO Engine Maintenance Cost Temporary Aircraft Utilization Held back by pilot training/ Engine Issues Switch from CEOs to NEOs Big Fuel Savings Mark-to-market on capitalized Recurring leases 8

  10. Slide 10: Revenue Headwinds in FY20

    Revenue Headwinds in FY20 • Pilot Shortage • Uncertainty on Jet • These • Lower Airways slots headwinds Utilization likely to • Uncertainty on Jet disappear by • Shorter Airways bilateral Summer Booking Window 2020 • Risk of losing other bilateral • NEO Engine Issues 9

  11. Slide 11: Update on NEO engines

    Update on NEO engines Key Event Description Status Operate only those neo aircraft which DGCA directive dated have one modified engines if other Completed 28th Oct 2019 engine has accumulated more than 2900 hours DGCA directive dated Replacement of all unmodified engines In talks with manufacturer f

  12. Slide 12: Q3 Outlook

    Q3 Outlook  PBT for Q3 FY19 was INR 1,909 mn  Despite the MTM hit on capitalized lease liabilities, we expect our profits to be similar to Q3 FY19 in Q3 FY20  Y-o-Y, both RASK and CASK are expected to increase by about 4-5% during the quarter Major Risks Adverse movement in fuel prices and/ or fo

  13. Slide 13: Annexures

    Annexures

  14. Slide 14: Definitions and Abbreviations

    Definitions and Abbreviations Term Description ASK Available Seat Kilometer CASK Total Cost net of Finance income per Available Seat Kilometer Total Cost excluding Fuel cost net of Finance income per Available Seat CASK ex Fuel Kilometer MTM Mark to Market IOCL Indian Oil Corporation Ltd ATF Air Tur

  15. Slide 15: Thank You

    Thank You

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