News
AirAsia and AirAsia X return to profit
March 4th 2016
Shares of Malaysian AirAsia and AirAsia X (AAX) climbed to an eight-month high this week after the budget carriers posted better than expected results and showed clearer signs of executing turnarounds. Read More »
Mainline AirAsia returned to the black with a 554.2 million ringgit ($134 million) net profit in fourth-quarter 2015, which reversed an 428.5 million ringgit net loss in the year-ago quarter. The average fare rose to 177 ringgit ($43) from 171 ringgit a year earlier.
Following the announcement, AirAsia’s full-year 2015 net profit improved more than six-fold, from 82.8 million ringgit in 2014 to 541 million ringgit to December 31, 2015. Revenues increased by 16.3% and operating costs dropped mainly because of low fuel prices.
AirAsia CEO, Aireen Omar, said the results were “very good indeed for the Malaysian operations”, and cited ancillary revenues as another bright spot for the carrier. They grew 14% year-on-year. Omar added that revenue from flight insurance increased by more than 40% year-on-year.
At AAX, the long-haul budget carrier posted its first ever profit, following eight quarters of losses. The carrier reported a net profit of 201.6 million ringgit ($48.8 million) in the fourth quarter to December 31, on better operating performance, other income, foreign exchange gains and deferred taxation.
For the full-year, AAX reduced its net loss to 360.2 million ringgit ($87.2 million) from a previous loss of 519.4 million.
At the AirAsia Group’s India offshoot, AirAsia India, losses continue. It almost doubled its quarterly net loss in the September-December period, from 12.7 million ringgit to 23.4 million ($5.7 million). This was mainly due to higher aircraft leasing costs and downward fare pressure.
The AirAsia Group has hedged 52% of its 2016 fuel needs at an average cost of $59 a barrel, group CEO, Tony Fernandes, said.
