AirAsia Group’s net loss narrows to RM767.42m for Q1 FY2021

AirAsia planes prepare for take-off at Don Mueang International Airport in Bangkok, Thailand, June 29, 2016. — Reuters pic
AirAsia planes prepare for take-off at Don Mueang International Airport in Bangkok, Thailand, June 29, 2016. — Reuters pic

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KUALA LUMPUR, May 27 — AirAsia Group Bhd’s (AAGB) net loss for the first quarter ended March 31, 2021 (Q1 FY2021) narrowed to RM767.42 million from RM803.85 million in the same quarter last year.

Revenue fell 87 per cent to RM298.22 million from RM2.31 billion a year ago.

In a filing with Bursa Malaysia today, the airline said the major portion of the loss for the period relates to depreciation of the right-of-use asset and interest on lease liabilities.

“The impact of the Covid-19 pandemic continues to affect the group’s operations adversely.

“While international borders remain closed, the group focused on providing limited domestic operations in the countries we operate,” said AAGB.

The aviation company added that lockdowns announced in Malaysia in January 2021 further dampened sales in this quarter.

“However, there were more chartered cargo operations which tripled cargo revenue quarter on quarter,” it noted.

The budget airline said with the right foundations and platforms in place as a leaner and optimised airline operations that were pursued by the group in 2020, AAGB was able to see fruits in 1Q FY2021 with lower cost and cash burn.

The group will continue to ensure that cash burn remains low and cost optimisation measures continue to be implemented.

Even if borders remained closed, AAGB is well-prepared to rely solely on domestic operations alone this year, it said.

Meanwhile, AAGB noted it will not be classified as a Practice Note (PN) 17 listed issuer and will not be required to comply with the obligations under paragraph 8.04 and PN17 of the main listing requirements (Main LR) for a period of 18 months from the date of the first relief announcement.

The company will reassess its condition and announce whether it continues to trigger any of the suspended criteria upon the expiry of the 18 months from the date of the first relief announcement, it added.

AAGB triggered the prescribed criteria pursuant to paragraph 8.04 and paragraph 2.1(a) of the PN17 of the Main LR, where its shareholders’ equity on a consolidated basis is 25 per cent or less of its share capital (excluding treasury shares) and such shareholders’ equity is less than RM40 million based on the audited financial statements for the financial year ended Dec 31, 2020.

However, Bursa Malaysia had via letters dated April 16, 2020 and February 17, 2021 granted PN17 relief measures to the company from April 17, 2020 to June 30, 2021. — Bernama

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