NO-FRILLS airline AirAsia Bhd reported a net loss of RM176.9mil for
the fourth quarter ended Dec 31 compared with a profit of RM245.7mil in
the previous corresponding period due to an exceptional item of
RM426mil related to the unwinding of its derivative structures.

Core
operating profit, however, more than doubled to RM194mil for the
quarter under review against RM94mil a year earlier. There was a
translation gain of RM11mil from the ringgit recovery against the
greenback.

Revenue jumped 32% to RM838.2mil from RM632.8mil a year earlier on improved passenger volume and higher ancillary income.

In
a filing with Bursa Malaysia yesterday, the airline said passenger
volume grew 21% while the average fare was 7% higher at RM229 from
RM214 a year ago. Load factor improved to 78.4% from 77.8% previously.

AirAsia
associate Thai AirAsia increased local market share to 40% as at
end-December from 34% previously, despite the increased political
disturbance that affected travel sentiment.

Its Thai and Indonesian operations’ share of unwinding losses was RM8.8mil and RM2.4mil respectively for the fourth quarter.

For
the full year, AirAsia achieved a net loss of RM471.7mil from a profit
of RM697.6mil in 2007 due to an exceptional item of RM641mil related to
the provisions for unwinding fuel and interest rate swap derivative
structures.

The 47% jump in the average jet fuel price dragged down the full-year core operating profit by 19% to RM171mil from 2007.

Revenue
for FY08, however, rose to RM2.6bil against RM1.9bil in 2007, thanks to
improved passenger volume and better ancillary income. Passenger volume
grew 22% to 11.8 million in 2008 while the average fare was 11% higher.

Load
factor was lower at 75.4% against 78.6% earlier on the back of a 29%
growth in capacity in 2008. AirAsia had introduced 32 routes during the
year and had a fleet of 75 aircraft as at end-December.

Group
chief executive officer Datuk Tony Fernandes says the airline sold 20%
more tickets from Jan 1 to Feb 25 this year versus the equivalent
period in 2008.

“Our forward booking trend is consistent to last
year’s and there is no letdown in terms of demand. We’re not feeling
the same effects that other carriers are facing,” he told a briefing
yesterday.

AirAsia, instead, is benefiting from the economic slowdown as people switch to better-value-for-money airlines.

It is taking delivery of 14 new Airbus A320 this year and returning nine Boeing 737-300 planes, giving a net addition of five to its fleet size.

The
low-cost airline also plans to introduce 15 routes this year, mainly to
new cities in India like Hyderabad, Mumbai, Bangalore, Delhi, Madras,
Kolkata and Kochi, as well as looking to fly to Taipei.

Fernandes
says AirAsia aims to carry 13.5 million passengers from Malaysia this
year and 22 million passengers in total with the new routes and
additional flight frequency. It aims to boost contribution from
ancillary income to 15% from 9% in FY08. In addition, the recent
introduction of Web check-in would provide some cost savings, he adds.

Fernandes
says the total unwinding of its hedging contracts and interest rate
swaps (IRS) in the fourth quarter would allow AirAsia to “start on a
clean slate” in 2009.

It currently has 65% exposure in currency hedge pegged at an average rate of 3.20 against the dollar.

Meanwhile,
the group’s long-haul airline, AirAsia X, will commence cargo service
to and from Europe with the inception of its maiden flight on March 11
between Kuala Lumpur and Stansted, London.

Via : TheStar

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