AirAsia Group: All AirAsia ASEAN airlines expected to be profitable in 2019

28 February, 2019

AirAsia Group outlined (27-Feb-2019) its strategy for 2019 as follows:

  • The group is confident that all AirAsia carriers in ASEAN will be profitable;
  • The carrier reported a "strong trend" in passenger traffic and load factor in 1Q2019 and is targeting group load factor of 85% for FY2019:
    • Malaysia AirAsia: 86%;
    • Indonesia AirAsia: 85%;
    • Philippines AirAsia: 91%;
    • Thai AirAsia: 90%;
    • AirAsia India: 87%;
  • Fuel:
    • 52% of Brent hedged at USD63.41 per barrel for FY2019;
    • If Brent increases to USD80 per barrel, the unhedged portion of fuel costs could increase by MYR368 million (USD90.3 million);
    • 40% hedged at USD59.89 per barrel for FY2020 and 4% at USD59.23 per barrel for FY2021;
  • Ancillary revenue:
    • RedCargo generated MYR206 million (USD50.6 million) in FY2018 and will "double up" in FY2019 as the carrier seeks to support e-commerce initiatives in ASEAN;
    • The carrier aims to up sell ancillaries and 'Ourshop' by all six airlines through data, machine learning and artificial intelligence;
  • Cost cutting initiatives:
    • 10% headcount rationalisation;
    • Closure of call centres by Jun-2019 due to automation. [more - original PR]