AirAsia swings to loss in third quarter

The airline said it expects improved operational performance in the fourth quarter and continuing into next year.

Today, MIDF Amanah Investment Bank Bhd analyst Tay Yow Ken wrote in a note that AirAsia X’s 9MFY15 core net loss of RM215 million was within MIDF’s and street forecast. “AirAsia Net Loss Widens in 3rd Quarter”, at 1138 GMT, incorrectly said in the headline, first and and second paragraphs that the company’s third-quarter net loss had widened from a net loss of 5.40 million ringgit a year ago. Total passengers carried fell from 1.04 million to 902,000 over the corresponding period, alongside a correspond expansion in fleet size from 24 to 26 aircraft.

Revenue increased by 15 percent to RM1.52 billion due to an increase in passenger numbers, fuelled in particular by increased demand from Chinese travelers, AirAsia said.

The Malaysia-based group booked prior-year unabsorbed losses of 469 million ringgit ($156 million) in July-Sept for its Indonesian associate, while the company’s foreign exchange losses soared to 436 million from 153 million a year ago.

All signs point towards rational and sustainable growth while the irrational price war that took place in the past is over, says its chief executive officer. “This created uncertainty and prompted travel agents to divert bookings away from IAA”.

AirAsia X Bhd, the long-haul sister carrier of AirAsia Bhd, posted a RM288.2 million net loss for the third-quarter (3Q) of 2015 due to higher operating expenses and foreign-exchange losses in spite of a 13.5% increase in revenue to RM793 million.

For the three months, AAX narrowed its operating loss to RM31 million from a RM133 million loss in the same period previous year.