The company posted a pre-tax loss of RM117.28 million for the first quarter 2015 ended March 31, compared with a pre-tax loss of RM48.13 million previously.
AirAsia X Bhd has flagged several new initiatives in a bid to reduce its losses. These include a focus on its AirAsia BIG loyalty programme, the onboard sale of exclusive duty free products to enhance ancillary revenue, the sale of aircraft and the launch of new routes by subsidiary airlines.
The company posted a pre-tax loss of RM117.28 million for the first quarter 2015 ended March 31, compared with a pre-tax loss of RM48.13 million previously.
Revenue, however, rose 3.5 per cent to RM775.37 million from RM749.48 million previously, the company said, citing “strong revenue driven by charters and wet leases, operating lease income and cargo”.
AirAsia X Group chief executive Datuk Kamaruddin Meranun described 2014 as “a challenging and extraordinary year for us and the aviation industry as a whole. The profitability in 2014 was affected mainly by the three tragic aviation incidents, irrational price war and overcapacity posted by the national carrier (MAS).”
He said their were plans to increase Indonesia AirAsia X (IAAX) services - currently operating with two A330-300 aircraft serving Bali-Taipei and Bali-Melbourne – to Sydney and Jeddah in Saudi Arabia.
Meranun said there two aircraft would be sold and there would be
“no major investment on aircraft this year“. Delivery of two aircraft in 2016 would be delayed to manage cash flow.
“Besides that, we remain focused on intensifying our marketing activities in core markets, especially Australia and China where travel demand has softened after the three tragedies last year.
“We are working towards exploring more exciting collaboration projects with travel agents and tourism bodies to bring back positive travel demands and loyalty,” Meranun added.
TWA TAKE: The Air Asia X group has decided that it’s time to draw breath as demand slows in its major markets. Despite all the hype of recent years, low cost airlines – just like the legacy carriers - need to adjust as the headwinds of foreign exchange losses and over-capacity slow progress.