Thursday 28 Mar 2024
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KUALA LUMPUR (Feb 27): AirAsia Bhd, which encompasses Malaysia, Indonesia and Philippines operations, posted a 19.9% decline in net profit to RM372.65 million in the fourth quarter ended Dec 31, 2017 (4QFY17), from RM465.32 million a year ago, dragged by income tax expense and deferred taxation.

This resulted in a lower earnings per share of 11.2 sen in 4QFY17, compared with 16.7 sen a year earlier.

Quarterly revenue, however, was up 37.2% to RM2.66 billion in 4QFY17 from RM1.94 billion a year ago, due to consolidation of PT Indonesia AirAsia and Philippines AirAsia Inc’s accounts and a 17% year-on-year (y-o-y) increase in the total passengers carried during the current quarter under review.

In a filing with Bursa Malaysia today, AirAsia said the RM40.5 million income tax expense comprises tax payable on interest income for the listed entity and corporate income taxes for its subsidiaries.

AirAsia also said there was a RM99.5 million deferred tax liabilities, arising from the difference between the net book value and tax written down value of property, plant and equipment in the quarter under review. 

“The deferred tax assets reduced as capital allowances were utilised in combination with the investment allowances granted,” the filing added.

AirAsia said average fare fell 7% to RM182 in 4QFY17 from RM195 in 4QFY16, while the overall revenue average seat per kilometer dropped 4% to 15.46 sen against 16.14 sen in 4QFY16.

Nevertheless, the airline recorded a marginal 1.1% increase in net profit to RM1.64 billion for the full year FY17, compared with RM1.62 billion the previous year, as revenue jumped 41.8% to RM9.71 billion from RM6.85 billion in FY16.

AirAsia saw an 11% increase in total passengers carried and a corresponding increase in passenger load factor to 88% in FY17 from 87% in the previous year. However, the average fuel price was higher at US$69 per barrel jet kerosene in 4QFY17, compared with US$64 in 4QFY16.

Its net debt after offsetting the cash balances amounted to RM7.4 billion as of end December 2017, bringing a net gearing ratio of 1.16 times. 

On prospects, AirAsia said it is projecting to achieve an average load factor of 87% in 1QFY18, based on its existing forward booking trend. 

It is also planning for an additional five aircraft, through operating leases in the first quarter of 2018. The airline's aircraft fleet stood at 123 as at Dec 31, 2017. 

In a separate statement, AirAsia group chief executive officer Tan Sri Tony Fernandes said the airline now dominates 55% of the Malaysian market, up from 47% a year ago.

"Our klia2 hub is still the top transit hub by our passengers, contributing 61% of the overall Fly-Thru traffic, and a growth of 40% from 1.1 million passengers to 1.5 million passengers y-o-y. We foresee higher uptake of this ancillary product, as we continue to strengthen our synergy with our long haul sister company AirAsia X Bhd," Fernandes added.

On outlook, Fernandes said travel demand in the region is still largely unmet by current offerings.

“We will continue to grow our presence and market share in the Asean region, with Vietnam as the final piece of the puzzle to complete our Asean connectivity.

"AirAsia is optimistic about the growth potential of low-cost air travel, and the potential of our fares to stimulate and grow new markets. We (AirAsia Group) look to more than double our current fleet of narrowbody aircraft, now over 200-strong, to 500 fleet by 2027," Fernandes said, adding the listing status from AirAsia Bhd to AirAsia Group Bhd is on target to complete in the second quarter of 2018.

Barring any unforeseen circumstances, AirAsia said it remains positive that overall results in 2018 may be better than 2017.

AirAsia shares closed unchanged at RM4.46 today, with 9.66 million shares done, giving it a market capitalisation of RM14.91 billion.

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