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AirAsia posts soaring 2010 results

AirAsia posts soaring 2010 results

2010 Highlights:

- Profit after tax: £215.5 million (increase of 111% year on year)
- Core operating profit rose to £167 million, up 83% from 2009
- Ancillary income per passenger rose 39% to £8.30
- Net gearing ratio 1.75 (down from 2.57 year on year)

Q4 2010 Highlights:

- Profit after tax for Malaysia AirAsia was up to £63.9 million ( increase of 835% year on year)
- Load factor rose to 82% (increase of 3% year on year)

AirAsia Berhad, the Malaysian based low-cost airline, recorded a milestone profit after tax, in what CEO Tony Fernandes hailed as a “phenomenal achievement.”


The Company achieved record profits with strong cash balances and decreasing gearing rates, “AirAsia is in the best position, financially, that it has ever been in - providing a strong foundation for further expansion and growth in 2011,” Fernandes added.

Fernandes emphasised the increased contribution from ancillary income to the Company’s bottom line, and said that the growth in ancillary income (39%), in pace with the rising passenger loads, was a strong affirmation of the Company’s strategy at looking beyond just air fare to strengthen revenues.

Thai AirAsia and Indonesia AirAsia performed strongly in the fourth quarter with Thai AirAsia recording a 29% revenue growth year-on-year and ancillary income per passenger increasing by 109%. Indonesia posted a steady rise in revenue of 38% with ancillary revenue growth of 108%.

On the outlook for 2011, Fernandes said the challenges would be to build on, and exceed, the 2010 performance. “With our plans to further expand our route network, supported with the delivery of 8 brand new Airbus A320s, and the opening of three hubs we can position ourselves to emphasise on further increasing load factor and yields.” 2011 will see the potential listings of Thai AirAsia and Indonesia AirAsia while the Company also plans to launch operations in the Philippines. 

Fernandes acknowledged that external factors beyond management’s control could impact some of the Company’s plans for 2011. In particular, he referred to the geopolitical developments in the Middle East and North Africa and the uncertainties in the global economy. “These could have an effect on the price of oil. We’re monitoring the situation very closely. We already have short term hedges in place up to the 2nd quarter of 2011, and we will add more if the situation warrants it. We are determined to keep fares low, and have the option of imposing a fuel charges or raising fares. Thanks to our ancillary initiatives, we are in a better position than our competitors when it comes to making these decisions, as we have a lot more latitude than they have,” he said.