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Saturday, February 27, 2016

AirAsia back in the black with net profit in 4Q

KUALA LUMPUR (Feb 26): Budget carrier AirAsia Bhd returned to the black with a net profit of RM554.2 million or 19.9 sen per share in its fourth quarter ended Dec 31, 2015 (4QFY15) compared with a net loss RM428.51 million or 15.4 sen loss per share a year ago, on higher revenue and a 21% reduction in the average fuel price from US$95 per barrel in 4QFY14 to US$75 per barrel in 4QFY15.

Revenue grew 47% to RM2.17 billion from RM1.48 billion in 4QFY14, supported by a 10% growth in passenger volume, while the average fare was up 4% at RM177 compared with RM171 achieved in 4Q14.

The airline posted revenue per available seat kilometre (RASK) of 22.29 sen in 4QFY15, up 40% year-on-year (y-o-y), while ancillary income per passenger increased 4% to RM49, close to its near term target of RM50. The seat load factor was at 85%, which was 7 percentage points higher than the same period last year.

“As seen in 4QFY15, we are a beneficiary of the low fuel price. As of now, the group has hedged 52% of its fuel requirement for the financial year ending Dec 31, 2016 (FY16) at an average cost of US$59 per barrel on jet kero. Passing on this benefit to our passengers through the removal of fuel surcharge earlier last year proved to be rewarding with demand increasing double digit in 4QFY15,” said AirAsia group chief executive officer Tan Sri Tony Fernandes in a statement today.

For FY15, AirAsia’s net profit grew more than six-fold to RM540.96 million from RM82.8 million in FY14, while revenue came in at RM6.3 billion in FY15, up 16.3% from RM5.4 billion the previous year.

“The revenue was supported by a 10% growth in passenger volume despite the lower average fare RM157 in 2015,” said AirAsia in a filing with Bursa Malaysia today.

“Ancillary income per passenger increased by 2% to RM47 y-o-y. The seat load factor was at 81% which was two percentage points higher than the same period last year,” it added.

AirAsia noted that despite the improvements in revenue and operating profits for the year, its pre-tax profit was negatively impacted from the recognition of current and prior year losses of Indonesia AirAsia of RM797.7 million in FY15.

Net cash flow in 4QFY15 amounted to a RM1.2 million inflow, as cash inflows from operating and investing activities exceeded financing cash outflows.

The group’s total debt as of end of December 2015 was RM12.6 billion. Its net debt after offsetting the cash balances amounted to RM10.2 billion.

On prospects, AirAsia is forecasting an average load factor of 84% for its Malaysian operations and an improved fare environment through capacity rationalisation by other players.

“We remain positive in the outlook of Malaysia AirAsia in the remaining quarters of 2016, as we continue to observe strong demand from the Chinese nationals and a more favorable fuel price ahead,” it said.

AirAsia shares fell five sen or 3.47% to close at RM1.39 today, for a market capitalisation of RM3.86 million.

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