AirAsia CEO Tony Fernandes sees full recovery within two years

Tan Sri Tony Fernandes

Tan Sri Tony Fernandes

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KUALA LUMPUR (Feb 22): AirAsia Group Bhd, which remains optimistic about achieving its fundraising target of RM2.5 billion, expects a gradual recovery in all of its key markets this year, its group chief executive officer (CEO) Tan Sri Tony Fernandes said, with potentially a full recovery within the next two years.

"I am confident that AirAsia will recover faster than many due to our low-cost model, position in the market and the fast-tracking of our digital transformation to become Asia's leading travel and lifestyle super app, which has helped to mitigate adverse effects from the Covid-19 pandemic," he said in a statement today.

“We have been through our fair share of crises in the past including starting out just after 9/11, SARS bird flu epidemics, tsunamis and earthquakes to name a few, but Covid-19 has by far, posed the most challenging situation we have ever experienced. Never before has there been such a restricted global travel environment. After a year of strict cost containment including exiting Japan and reducing our stake in India, finally there is light at the end of this very long tunnel."

Fernandes added that the low-cost carrier has spent the travel downtime period to put in place "rigorous digital initiatives and innovative technologies that would make air travel even safer and more seamless post-Covid-19".

"Better testing, leisure travel bubbles, anti-veil medicines and importantly, digital health passports providing a single tool for health records across Asean and beyond, are also coming soon, to support the global travel recovery," he said.

Fernandes noted that AirAsia used the downtime in flying in 2020 to fast-track its digital transformation to become more than just an airline including the introduction of numerous new products that provide new revenue streams including the airasia super app, logistics, e-commerce, fintech, as well as new procedures and innovation such as biometric facial recognition to make flying more hygienic and contactless.

The carrier welcomed news of Covid-19 vaccines being rolled out across Malaysia this week.

"After a year of uncertainty, it's great to see that this extremely challenging chapter is finally coming to a close," Fernandes said, adding that AirAsia’s key international markets are also progressing well with the vaccination programme including Indonesia, Singapore, China and Australia, while other regional countries such as Thailand and the Philippines are scheduled to begin their vaccination programmes by the first quarter of this year.  

Meanwhile, the first tranche of its private placement of up to 20% of the group's total issued shares was completed last week, with 11.07% placed out, raising a total of RM250 million.

"We are working towards obtaining approval for the loan under the Danajamin PRIHATIN Guarantee Scheme within the next month. Concurrently, we have positive ongoing discussions for other fundraising support measures in many of our key markets such as Thailand, Indonesia and the Philippines which we will announce in due course," said Fernandes.

"Other capital raising and financial support measures are being considered, including capital raising for our digital entities. We expect further clarity to be reached on all funding efforts by the end of March."

AirAsia's net loss topped RM2.66 billion in the first nine months ended Sept 30, 2020. Revenue plunged 68% to RM2.87 billion from RM9.09 billion a year earlier. It is due to release its 4QFY20 and full-year FY20 numbers this week, unless there is a delay following Bursa Malaysia's announcement allowing a one-month deferment.

At 3.48pm, AirAsia shares were up four sen or 5.19% to 81 sen, bringing a market capitalisation of RM3.01 billion. A total of 46.49 million shares were traded.

Kang Siew Li