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AirAsia reports revenue jump helped by cargo operations

02:16, 9 September 2021

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AirAsia planes at Kuala Lumpur International Airport 2
AirAsia planes at Kuala Lumpur International Airport 2 – Photo: Shutterstock

AirAsia Group on Wednesday said its quarterly revenue more than doubled from a year ago boosted by a rise in chartered cargo operations.

The budget airliner said net loss for the June quarter narrowed to MYR719.6m (USD173.3m) from MYR1.16bn a year ago, helped by absence of fuel swap losses and gains from foreign exchange movements.

Quarterly revenue jumped about 160% to MYR370.6m from a year ago, the company said.

Diversification

The airline business posted a near fourfold increase in quarterly revenue from a low base a year ago. Seat load factor stood at 68% for the June quarter compared with 59% a year ago, a bourse filing showed.

The company has been working on diversifying its business away from its core airline business through its digital portfolio of fintech unit, logistics arm and its super app.

AirAsia launched ride-hailing services in Malaysia last month. In July, AirAsia Group’s fintech arm submitted an application for a digital licence with the Malaysian central bank.

Digital revenue

Airasia super app reported negative earnings before interest, taxes, depreciation and amortisation of MYR41m in the June quarter compared with negative MYR15.5m a year ago.

The company’s fintech arm, BigPay Group, reported a 56% year-on-year increase in quarterly revenue.

AirAsia’s logistics service, Teleport, saw revenues triple from a year ago but operating losses widened to MYR15.2m.

Renegotiated leases

Overall, the company’s digital revenue, which comprises its fintech and logistics arm and its super app, reported a quaterly operating loss of nearly MYR86m compared with loss of MYR46.7m a year ago.

AirAsia Group said it expects digital revenues to contribute around 50% to the company in five years.

The company added that renegotiated lease terms with lessors which will see a lower lease rental per aircraft in the future.

“To preserve cash, the Group is in negotiations with lessors to restructure lease terms,” the company said. “We expect to complete the renegotiations with all lessors by end of the year.”

Read more : AirAsia Group’s fintech arm to launch Malaysia digital bank

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