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AirAsia X expects Scheme of Arrangement verdict in June
December 4th 2020
AirAsia X Berhad (AAX) expected a verdict on its business reorganisation plan by June 30 next year. Read More » The LCC group informed the Bursa Malaysia it was changing its financial year end date to June 30, from its current end date of December 31 to offer a clearer basis to prepare its audited accounts, given the restructuring of the business.
"The company is undergoing a Scheme of Arrangement, the outcome of which will not be known by 31 December, 2020, the current financial year end," AAX said. "The basis of preparation of the audited financial statements and the audit opinion ("AFS") is therefore uncertain and the AFS will be of limited value to shareholders.
"By 30 June, 2021, the outcome of the Scheme is likely to be known, so there will be a clear basis for the preparation of the AFS, which will be of more value to shareholders."
In October, AAX admitted to severe liquidity constraints in meeting its financial commitments. The company said a debt and corporate restructuring effort and a change in business model was the only course of action to avoid liquidation.
The proposed debt restructuring asks unsecured creditors to reconstitute $63.5 billion ringgit (US$15.6 billion) of debt into an outstanding amount of $200 million ringgit, with the balance in excess of that amount to be waived, and proposed reducing its issued shares by 90%, with 10 existing ordinary shares consolidated into one share.
The third plank of the LCC's recovery strategy is growing yield and profitability instead of market share. In October, AAX said it would operate 25 A330s, pointing to orders the A350-900 and A321XLR may be up for renegotiation.
AAX reported a 308 million ringgit net loss for the three months to September 30, 2020, from a net loss of 230 million ringgit a year earlier. Revenue collapsed by 94%, to 60 million ringgit, from one billion ringgit previously. In November, AAX said the deadline to submit its business restructuring plan to creditors and shareholders had been extended to January 6, 2021.
