AirAsia X Q2 profits soar on forex gains

AirAsia X Q2 profits soar on forex gains

AirAsia X Q2 profits soar on forex gains

Long-haul budget airline, AirAsia X Bhd, returned to the black with a pre-tax profit of RM27.95 million in the second quarter ended June 30, 2017 (Q2 2017), from a pre-tax loss of RM9.23 million registered in the same period past year. It also benefited from higher deferred taxation during the quarter.

Passenger load factor - a measure of how full planes are - improved 5 percentage points to 80 percent, in line with the 26 percent year-on-year growth in available seats per kilometres (ASK) to 8,449 million.

Average base fare was slashed by 14% y-o-y from RM526 to RM455 as a strategy to stimulate demand. The drop in RASK was due to increased capacity on existing routes resulting in lower yields, it said.

Freight and cargo revenue, meanwhile, rose by 27% to RM39.2mil in the quarter under review due to higher tonnage transported.

"The second quarter for AirAsia X Malaysia has seen more ASK capacity injected as compared to the same quarter previous year".

The quarterly performance was helped by aircraft leasing income growing 15 percent over the period to 123 million ringgit, mainly due to the depreciation of the ringgit, while ancillary revenue grew 41 percent from a year ago to 193.5 million ringgit. "This was to set the tone for future quarters especially the fourth quarter of 2017 and the first quarter of 2018, both historically strong quarters", AirAsia X group chief executive Kamarudin Meranun said in a statement late Thursday.

"However, the depreciation of the ringgit remains a key concern as a large portion of the company's borrowings and operating costs are denominated in United States dollars", it said.

Barring any unforeseen circumstances, including fuel price hike and fluctuation in foreign currencies against the ringgit, AAX said it expected its prospects to remain positive.

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