KUALA LUMPUR (May 24): AirAsia Bhd's net profit surged 86.6% to RM1.09 billion in the first quarter ended March 31, 2018 (1QFY18) from RM584.25 million a year ago, on the back of a 16% increase in passengers carried and a RM350.3 million gain from the disposal of subsidiary Ground Team Red Holdings Sdn Bhd.

The budget airline said the gain was partially offset by current and deferred taxation charges of RM104 million in the current quarter under review.

AirAsia posted higher earnings per share of 34.2 sen in 1QFY18 compared with 18.4 sen in 1QFY17.

Quarterly revenue was also up 14.8% to RM2.56 billion in 1QFY18 from RM2.23 billion a year ago.

The airline also declared an interim dividend of 12 sen for the financial year ending Dec 31, 2018, payable on July 13.

In a filing with Bursa Malaysia today, AirAsia said passenger load factor for 1QFY18 stood at 87%, down from 89% in 1QFY17, as seat capacity grew 19% year-on-year (y-o-y).

Average fare remained constant at RM171 y-o-y, while the overall revenue per available seat-kilometer fell 2% to 14.68 sen in 1QFY18 against 14.91 sen in 1QFY17.

The airline’s net debt after offsetting the cash balances amounted to RM7.1 billion as at end-March.

On prospects, AirAsia is projecting to achieve an average load factor of 87% in 2QFY18 based on the existing forward booking trend of Malaysia AirAsia, Indonesia AirAsia and Philippines AirAsia.

"In Thailand, load factor in 2QFY18 is forecast to be 84% based on existing forward booking trend, while in India the forecast load factor is at 86%," it said.

"In Japan, the forecast load factor for 2QFY18 is forecast to be 76%. AirAsia Japan will focus on building footprint in the domestic market and connecting to the group’s existing network within the region. The growth of Japan will depend on the speed of regulatory approval," it added.

Groupwise, AirAsia plans to add three aircraft through operating leases in 2QFY18 to serve the growing demand in the region.

"Fuel is adding cost pressure and to mitigate this, the group is actively reducing costs by driving more ancillary sales and ensuring better performance by all associate airlines.

"Barring any unforeseen circumstances, the board remains positive that the overall results of the group in 2018 may be better than 2017," it added.

In a separate statement, AirAsia Group Bhd group chief executive officer Tan Sri Tony Fernandes said the airline will be undergoing a secondary listing exercise for its Indonesia operations this year.

"We are also on track to list AirAsia Philippines in the second half of 2019.

"In addition, we will soon be announcing a special dividend for the sale of our aircraft leasing operations Asia Aviation Capital Ltd,” he added.

AirAsia shares closed 4 sen or 1.22% lower at RM3.23 today, with a market capitalisation of RM10.8 billion.