KUALA LUMPUR: AirAsia X Bhd’s results were disappointing as yield declined 12.5 per cent following industry overcapacity and an aggressive promotional strategy, says MIDF Research.
Adjusting for unrealised foreign exchange loss of RM48 million, the firm said AirAsia X posted a fourth consecutive core net loss of RM176 million. Over the first nine months of this year, the low-cost carrier’s accumulated core net loss widened to RM401 million.
“The promotions were to stimulate travel demand, which has been impacted by Thailand’s political instability and two domestic aviation disasters.
“The average fare dropped 16 per cent year-on-year to RM420 per pax.
“Despite capacity expansion easing in the quarter, the reported available seat per km declined 7.8 per cent year-on-year to 11 sen,” MIDF Research said in a report yesterday.
The firm said AirAsia X’s available seat per km improved slightly by 2.1 per cent year-on-year.
“We expect the yield decline to bottom out, benefiting from the possible capacity reduction undertaken by troubled Malaysian flag carrier MAS.
“The reported cost per available seat km was higher at 12.5 per cent year-on-year to 13 sen following the launch in associate and additional wet-lease operations.”