AirAsia Group, Malaysia's budget airline, reported a record quarterly loss as depreciation and impairments deepened the impact of lockdowns. However, the Airlines said it was confident of a full recovery in two years.
According to the report, the net loss in the October to December period widened to RM2.44 billion versus RM384.4 million a year earlier, overtaking the RM1.33 billion loss estimated in a Refinitiv poll. Revenue fell 92 per cent to RM267.4 million as capacity shrank by 88 per cent compared to a year ago, mainly because of lower capacity in Malaysia, the Philippines and Indonesia, as international borders remained closed.
A major portion of the loss for the period relates to depreciation of and interest on lease liabilities amounting to RM654.2 million. AirAsia's borrowings as of Dec 31 almost tripled to RM1.28 billion from RM428.9 million a year ago, mostly from deferred fuel hedge settlements.
AirAsia Group reported a 90 per cent fall in passengers compared to a year ago, resulting in load factor, a measure of how full planes are, dropping 15 percentage points to 67 per cent.
Meanwhile, the Group chief executive Tony Fernandes hopes the airline hoped for a full recovery in the next two years. He is also very optimistic international air travel would resume in the second half of this year as vaccination and testing accelerate.
AirAsia has been looking to raise RM2.5 billion to weather the pandemic; and also expects to secure RM1 billion in loans from Malaysian banks.