AirAsia X reports profit

SEPANG AirAsia X reported its financial results for the fourth quarter and full financial year that ended 31 December 2016 confirming its first full-year profit since its IPO.

The airline posted fourth quarter revenue of RM1.17 billion, up 39% from the same quarter last year. The strong revenue recorded was on the back of a 40% year-on-year growth in passengers carried to 1.38 million which was in line with the 44% available seat per km (“ASK”) capacity growth, allowing the company to record a load factor of 81%.

Average base fare was down by 4% to RM565 mainly attributed to increased frequencies to Australia and promotional fares offered on new routes.

Revenue per available seat km (“RASK”) was down 3%. The marginal drop in RASK was due to the expected increase in capacity on core existing routes to grow market share, putting downward pressure on yields.

However, the company’s cost, measured in terms of cost per available seat km (“CASK”), was significantly reduced, representing a drop of 11% year-on-year. The decrease in CASK was due to the company benefiting from a lower average fuel price environment and improved utilisation of aircraft.

During the quarter under review, the company posted a robust operating profit of RM100.1 million (up 14% YoY) and net operating profit of RM100.7 million (up 34% YoY). Net profit after tax (stood at 39.0 million, down 80% YoY, due to an unrealised foreign exchange loss of RM93.2 million, owing to unfavourable foreign currency movements in 4Q16.

AirAsia X Group CEO, Datuk Kamarudin Meranun, said: “I am happy to announce the result of our continuous turnaround effort, contributing significantly to operational performance.”

“We began 2017 on a positive note, with our first full-year profit since IPO as we strengthen our business in core markets, especially China and Australia. It was a record-breaking year; we registered a strong operating profit of RM276.0 million and an exceptional net profit of RM230.5 million for the full financial year 2016, demonstrating a strategy that is working and which lays a solid foundation for sustainable growth going forward. We have the opportunity now to build on recent successes and accelerate our momentum in 2017.”

Malaysia AirAsia X

Australasia routes continue to be the airline’s highest revenue contributor at 36%, with 45% growth YoY on the back of higher passenger traffic due to increased frequencies into Australia; followed by China sectors.

Thailand AirAsia X

The airline recorded lower operating performance mainly due to the short-term impact on the tourism sector from the passing of King Bhumibol Adulyadej and the Thai government’s crackdown on zero-dollar tours from China.

However, the outlook for the airline in 2017 remains positive as Thailand is a natural tourist hub with traditionally strong inbound and outbound track record.

Indonesia AirAsia X A330 services remain temporarily suspended as part of a network restructuring aimed at improving operational efficiencies at IAAX.

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