AirAsia X posts RM11m profit

  • Career,Stocks,Earnings,Airlines,Investing
  • Wednesday, 23 Nov 2016

PETALING JAYA: AirAsia X Bhd (AAX), the long-haul budget airline, has reported its fourth consecutive quarterly profit on higher revenue and improved cost efficiencies.

The lower price of fuel and the weaker ringgit are also benefiting the company.

AAX made a net profit of RM11mil in the third quarter ended Sept 30 compared with a loss of RM288mil a year ago.

“The third quarter for AAX has seen great capacity injected amounting to 10% out of the 32% planned for the whole year,” group chief executive officer (CEO) Datuk Kamarudin Meranun said in a statement.

“This was to set the tone for future quarters, especially the fourth quarter of 2016 and the first quarter of 2017, both historically strong quarters,” he added.

In a filing with Bursa Malaysia yesterday, the airline said scheduled flights revenue (net of refunds) had increased by 53.9% to RM610.2mil in the third quarter of 2016.

It said this was a result of an increase in passengers carried by 35% to 1.22 million passengers during the quarter.

“This was on the back of a 29% increase in seat capacity from 1.21 million seats in the third quarter of 2015 to 1.56 million seats in the third quarter of 2016.

“The resultant load factor was an improvement of 3% from the 75% load factor in the third quarter of 2015 to a 78% load factor in 2016. Average base fare also increased by 14% from RM440 in 2015 to RM501 in 2016.”

Revenue in the third quarter rose to RM982.40mil from RM793.01mil in the previous corresponding period.

For the nine-month period ended Sept 30, 2016, AAX reported a net profit of RM191.53mil compared with a net loss of RM547.05mil in the previous corresponding period, while revenue grew to RM2.84bil from RM2.22bil a year earlier.

In the same statement, CEO Benyamin Ismail said cost per available seat km had dropped 16% to a low of 12.06 sen from 14.32 sen against the same period last year.

“The low fuel price has benefited us and we have hedged 100% of required fuel at US$56 per barrel on planned existing routes, which allows us to better manage cost and mitigate fuel volatility as we venture into new routes.”

He added that the company’s net gearing ratio stood at 0.78 as at Sept 30, 2016, which was 13% lower against the preceding quarter as a result of lower total debt and increase in cash.

On the outlook, Benyamin said going into the peak year-end holiday season, the company is benefiting from the weaker currency environment as other nationalities are looking at Malaysia as a value-for-money holiday destination.

“The destinations that we fly to are more appealing compared to higher-currency destinations such as Europe and North America.”

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