KUALA LUMPUR (Aug 28): Medium-haul low-cost carrier AirAsia X Bhd (KL:AAX) reported a 13% fall in net profit for the second quarter ended June 30, 2024 (2QFY2024) to RM4.82 million from RM5.54 million a year earlier, on lesser travels due to the traditionally weaker travel season.

This led to a lower earnings per share of 1.1 sen for 2QFY2024 compared with 1.2 sen for 2QFY2023.

Net profit for 2QFY2024 was also down 94% from the RM80.12 million recorded in 1QFY2024, due to a 26% quarter-on-quarter decrease in revenue as average passenger fare was lower by 30% while ancillary revenue dropped 10%.

On a year-on-year (y-o-y) comparison, however, AAX's quarterly revenue rose 30.5% to RM669.14 million in 2QFY2024, from RM512.91 million in 2QFY2023, on higher ticket sales and ancillary revenue.

In a statement on Wednesday, AAX said it saw the number of passengers carried rise 42% y-o-y to over 880,000 passengers, surpassing the 30% y-o-y growth in seat capacity.

Ancillary revenue also increased over 48% y-o-y to RM218.2 million, in line with the increase in the number of passengers carried and buoyed by ancillary revenue per passenger increasing by 5% y-o-y to RM248 per passenger.

No dividend was declared for 2QFY2024.

For the cumulative six-month period (1HFY2024), the airline recorded a 74.5% drop in net profit to RM84.94 million from RM333.54 million a year earlier. This was despite revenue climbing 48.6% to RM1.58 billion from RM1.06 billion in 1HFY2023.

AAX said its Malaysian operation’s total fleet size remained at 18 Airbus A330s as at end-June 2024, with 16 aircraft activated and operational. AAX expects to reactivate its 17th aircraft in 3Q2024 and the final aircraft in 4Q2024.

Meanwhile, its associate AirAsia X Thailand's (TAAX) fleet size stood at eight A330s, with six aircraft activated and operational. TAAX expects the number of operational aircraft to increase to nine in 3Q2024 and 10 in 4Q2024.

AAX chief executive officer for Malaysia Benyamin Ismail said: “We will continue to grow in line with demand and market conditions as well as fleet developments. We expect our two remaining aircraft to rejoin operations by the second half of the year and this is estimated to deliver further upside to our bottom line, further driven by the appreciation of the ringgit and lower jet fuel prices. AAX’s network realignment and advancement for the past six months are on track, as we launched Almaty in Kazakhstan and ramped up additional capacity to many key destinations including China."

On its proposed acquisition of Capital A Bhd’s aviation business, Benyamin said the draft circular is under review by Bursa Malaysia and upon approval, it expects to hold an extraordinary general meeting in 21 days, and for the exercise to be completed by the end of the year. Capital A's aviation business encompasses airlines such as AirAsia Malaysia Bhd and AirAsia Aviation Group Ltd, which in turn comprises Thai AirAsia, Indonesia AirAsia, Philippines AirAsia and Cambodia AirAsia.

"Concurrently, AAX’s proposed fundraising of up to RM1 billion is also well underway. We look forward to sharing further details on the proposed acquisitions in the circular to shareholders in due course," he added.

In a separate filing with Bursa, AAX said it is conscious of the historical seasonality trends; but pointed out that its forward sales trajectory has been promising, as it remains confident in the resilience of the fare and load factor trend post-recovery.

"For 2HFY2024, the group is pleased to share that the booking trend outlook for its flight services and ancillary is positive. Barring any unforeseen circumstances, the group is optimistic that it will maintain this strong trajectory as we move into one of our strongest quarters between October and December. Furthermore, the recent movements in foreign exchange and jet fuel prices have been particularly reassuring, and the group continues to zero in on ensuring its cost structure discipline is upheld," it added.

AAX’s shares closed unchanged at RM1.33 on Wednesday, giving the group a market capitalisation of RM594.6 million. The stock has fallen 27.7% so far this year.