Summary
- AirAsia X records a net profit of RM5.6 million in 3Q23, signaling a powerful end to the yr for the airline and its wider groups.
- After appealing its financially distressed status, AirAsia X has been free of its PN17 classification by Bursa Malaysia.
- AAX’s revenue shows a big recovery in 3Q23, with a six-fold increase in comparison with the previous yr and a 64% recovery in comparison with pre-COVID levels in 2019.
It is difficult to know what would have pleased AirAsia founder Tony Fernandes probably the most this week – the profitable third quarter result from AirAsia X or the revoking of its PN17 status by Bursa Malaysia. Either way, the 2 events signal a powerful end for 2023 for the airline and the broader AirAsia and Capital A Groups and a promising future in 2024.
AirAsia X leaves PN17 behind
On Tuesday, AirAsia X Berhad released its financial results for the Third Quarter of 2023 (3Q23) ended September 30, recording a net profit of RM5.6 million ($1.2 million). Last month, Bursa Malaysia rejected an application by the airline for its financially distressed status (PN17) to be uplifted, a choice that the airline appealed.
Photo: Airbus
On this week’s announcement, AirAsia X said that following the corporate’s appeal and subsequent success of the conditions, AAX’s upliftment from PN17 could be effective from November 22. AAX has labored under PN17 since October 2021, and after five consecutive quarters of profitability, Bursa Malaysia has freed it from those financial shackles.
In 3Q23, AAX recorded revenue of RM648.4 million ($139m), six times higher than in 3Q22 and about 64% recovery in comparison with the identical quarter in pre-COVID 2019. AAX returned more of its Airbus A330 services within the quarter with a consequential rise in operating expenses, made worse by the weakening of the Malaysian Ringgit against the US Dollar. Despite 3Q being a historically slow quarter, AAX recorded a net profit of RM5.6 million.
Photo: alphonsusjimos/Shutterstock
Lots of Asia’s carriers are managing capability well, and in 3Q23, AirAsia X added nine times more capability year-on-year (YoY) to 1 million seats, while the variety of passengers grew ten times YoY to greater than 807,00. That’s produce yields and cargo aspects, and AAX lifted its passenger load factor to 80%, a rise of seven percentage points YoY.
In comparison with the previous quarter (2Q23), AAX’s seat capability grew by 24% quarter-on-quarter (QoQ). Compared, available seat kilometers capability grew by 26% as serviceable aircraft increased by three to 14 Airbus A330-300 aircraft in 3Q23. The low-cost carrier launched services to its second destination to India with services to Amritsar and its fourth destination in China to Chengdu.
Total A330 fleet nearly back in service
By the top of 3Q23, AAX was operating 114 flights weekly in comparison with 23 weekly flights in 3Q22. Flight frequencies to Perth and Shanghai were increased to every day when more aircraft were activated to fulfill growing demand, with flight frequency climbing by 19% QoQ.
Photo: GingChen | Shutterstock
AAX will soon start services to Almaty in Kazakhstan, so expansion is just not over, and AAX CEO Benyamin Ismail said:
“This quarter alone, three additional aircraft were activated to support the Company’s network growth requirements. In anticipation of the upcoming year-end peak travel season, we’re on course so as to add yet another aircraft bringing the fleet size to 18 aircraft, with not less than 17 operational by December 2023.”
As a low-cost carrier, ancillary revenue is an important element of profitability, and AAX said that it continued to deliver robust performance within the third quarter. Ancillary revenue per passenger in 3Q23 was RM238 ($51), caused by enhanced pricing strategy and sales channel optimization via airasia.com, which AAX said was to “elevate the user experience [and] ultimately drive a better take-up rate.
Have you ever flown with AirAsia X recently? Tell us about it within the comments.