AirAsia X revenue down on lower fares in 3Q2018, fuel price up 41%

    AirAsia X attributed (21-Nov-2018) a 4% year-on-year decrease in revenue in 3Q2018 to reduced revenue from scheduled services following a 5% drop in the average base fare to MYR473 (USD113.2) per passenger resulting from the introduction of new routes and capacity growth on existing routes. However, the airline noted the average base fare increased 13% compared to 2Q2018. Passenger traffic and load factor increased in 3Q2018 following the Malaysian general election. ASKs decreased 4% due to the redeployment of capacity to North Asia following “capacity management” in Australia and the suspension of Tehran service earlier in 2018. RASK decreased 1% due to the “short term impact” of the Tehran suspension and reduction in Kathmandu operations. Compared to 2Q2018, RASK increased 4% following improvements from China routes. CASK increased 12% year-on-year due to an increase in the average fuel price and provision for doubtful debts provided for AirAsia X Indonesia. The company mainly attributed its MYR205.2 million (USD49.1 million) net operating loss in 3Q2018 to the 41% year-on-year increase in the average fuel price to USD91 per barrel. AirAsia X Group CEO Nadda Buranasiri said: “The current operating environment is challenging, however, we strongly believe that our business model is strong and robust enough to weather these challenges”. He added: “We now have the right formula with an optimal mixture of monopoly and high traffic routes”. Mr Nadda also commented: “While we expect that the provision of doubtful debts will place short term pressures on the full year earnings, we remain confident on the ongoing efforts to boost our ancillary revenue, passenger growth and yields in the longer term”.