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AirAsia to expand fleet

Reuters / Khmer Times Share:
A file photo shows an AirAsia A320. Wiki Commons CC BY-SA

KUALA LUMPUR (Reuters) – AirAsia Bhd. said it would increase its fleet by 21 percent in the second half of the year, in one of the fastest pace of expansions for the Malaysian low-cost airline, after reporting record quarterly revenues on rising travel demand.

The group, which saw its second-quarter net profit crater mainly due to a one-off charge, said it planned to add 22 planes to its fleet – at 106 as of end-June – through a combination of finance and operating leases in the second half of 2017.

“This will be one of the fastest pace of expansions in the last few years, made possible due to the favourable competitive and operating environment of aviation in Asia,” AirAsia said.

The airline said it was projected to achieve an average load factor – a measure of how full planes are – of 88 percent in the third quarter based on the existing forward booking trend.

“For the remaining quarters of 2017, we remain optimistic as we continue to observe strong demand across most sectors coupled with a stable fuel price and foreign exchange environment.”

AirAsia reported a 73 percent year-on-year drop in its second-quarter net profit to 92.45 million ringgit ($21.67 million), including a one-off deferred tax charge that offset the impact of higher passenger numbers and load factor.

The profit, the smallest since the end of 2015, missed an estimate of 357.6 million ringgit from one analyst polled by Thomson Reuters. But the carrier’s revenue hit an all-time high 2.38 billion ringgit, up from 1.62 billion ringgit a year ago.

The airline reported a 2 percentage point rise in load factor to 89 percent in the second quarter ended June. Total number of passengers carried rose 10 percent to 9.6 million, versus an 8 percent capacity increase.

AirAsia requested for a suspension in the trading of its shares at the midday break, “pending a material announcement”.

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