28 Feb 2009
NO-FRILLS airline AirAsia Bhd reported a net loss of RM176.9mil for the fourth quarter ended Dec 31 compared with a profit of RM245.7mil in the previous corresponding period due to an exceptional item of RM426mil related to the unwinding of its derivative structures.
Core operating profit, however, more than doubled to RM194mil for the quarter under review against RM94mil a year earlier. There was a translation gain of RM11mil from the ringgit recovery against the greenback.
Revenue jumped 32% to RM838.2mil from RM632.8mil a year earlier on improved passenger volume and higher ancillary income.
In a filing with Bursa Malaysia yesterday, the airline said passenger volume grew 21% while the average fare was 7% higher at RM229 from RM214 a year ago. Load factor improved to 78.4% from 77.8% previously.
AirAsia associate Thai AirAsia increased local market share to 40% as at end-December from 34% previously, despite the increased political disturbance that affected travel sentiment.
Its Thai and Indonesian operations’ share of unwinding losses was RM8.8mil and RM2.4mil respectively for the fourth quarter.
For the full year, AirAsia achieved a net loss of RM471.7mil from a profit of RM697.6mil in 2007 due to an exceptional item of RM641mil related to the provisions for unwinding fuel and interest rate swap derivative structures.
The 47% jump in the average jet fuel price dragged down the full-year core operating profit by 19% to RM171mil from 2007.
Revenue for FY08, however, rose to RM2.6bil against RM1.9bil in 2007, thanks to improved passenger volume and better ancillary income. Passenger volume grew 22% to 11.8 million in 2008 while the average fare was 11% higher.
Load factor was lower at 75.4% against 78.6% earlier on the back of a 29% growth in capacity in 2008. AirAsia had introduced 32 routes during the year and had a fleet of 75 aircraft as at end-December.
Group chief executive officer Datuk Tony Fernandes says the airline sold 20% more tickets from Jan 1 to Feb 25 this year versus the equivalent period in 2008.
“Our forward booking trend is consistent to last year’s and there is no letdown in terms of demand. We’re not feeling the same effects that other carriers are facing,” he told a briefing yesterday.
AirAsia, instead, is benefiting from the economic slowdown as people switch to better-value-for-money airlines.
It is taking delivery of 14 new Airbus A320 this year and returning nine Boeing 737-300 planes, giving a net addition of five to its fleet size.
The low-cost airline also plans to introduce 15 routes this year, mainly to new cities in India like Hyderabad, Mumbai, Bangalore, Delhi, Madras, Kolkata and Kochi, as well as looking to fly to Taipei.
Fernandes says AirAsia aims to carry 13.5 million passengers from Malaysia this year and 22 million passengers in total with the new routes and additional flight frequency. It aims to boost contribution from ancillary income to 15% from 9% in FY08. In addition, the recent introduction of Web check-in would provide some cost savings, he adds.
Fernandes says the total unwinding of its hedging contracts and interest rate swaps (IRS) in the fourth quarter would allow AirAsia to “start on a clean slate” in 2009.
It currently has 65% exposure in currency hedge pegged at an average rate of 3.20 against the dollar.
Meanwhile, the group’s long-haul airline, AirAsia X, will commence cargo service to and from Europe with the inception of its maiden flight on March 11 between Kuala Lumpur and Stansted, London.
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