New Delhi: Rising fuel bills have led Air India to register a decline in its net profit by Rs 16.29 crore or a whopping 82 per cent in 2005-06, forcing it to enhance hedging in the global oil market.
With the fuel bill rising by Rs 952 crore, the management of the state-owned carrier has extended the hedging limits from 10 per cent of its international fuel uplifts to 25 per cent. The decision was made effective last week.
The sources said the airline, in the past eight months, has managed to save $400,000 due to hedging on oil lifted from abroad.
Observing that its fuel bill had touched Rs 3,134 crore in 2005-06 as against Rs 2,182 crore in the previous year, the sources said the fuel bill of Air India contributed to over 33 per cent of the costs, up from 28 per cent last year.
However, the airline reported an increase of 25 per cent in its total revenue at Rs 9,677 crore compared with Rs 7,750 crore in 2004-05.
There was also an increase of 25 per cent in total expenditure at Rs 9,660 crore in 2005-06 as against Rs 7,690 crore in the previous year.
Air India, which reported an increase of 10.5 per cent in the number of passengers carried during 2005-06, also enhanced its yield per revenue tonnes per kilometres from 58 cents last year to 62 this year.
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