AirAsia quarterly earnings surge
KUALA LUMPUR -” Low cost carrier AirAsia’s net profit in the October-December 2007 quarter soared 73% from a year ago, helped by increased passenger traffic, higher fares and growth in ancillary income from services such as hotel bookings and travel insurance.
Net profit rose to RM245.7 million for the fourth quarter, from RM142.1 million in the same period of the previous year.
For the six-month period, net profit doubled to RM425.7 million from RM212.1 million for the corresponding period in 2006.
Revenue for the half year was RM1.1 billion against RM774.9 million a year ago.
Chief executive Tony Fernandes said AirAsia had the highest operating profit margin of the world’s airlines in 2007, at 23.5%, higher than the average of all the low-cost carriers, which was 9.6%.
Operating margin measures profit or loss as a percentage of the airline’s total operating revenue.
AirAsia carried 6.5 million domestic passengers last year, overtaking Malaysia Airlines’ (MAS) 5.4 million passengers to become the largest domestic airline.
“Becoming the largest domestic airline has proved that both AirAsia and MAS can be successful. It shows that the government’s rationalisation (of domestic routes) was the right thing to do,” Fernandes told the Business Times.
Fernandes also said escalating fuel prices would not slow or derail the airline’s growth plans for the year, thanks to the past six years of investments in its network.
Ian Jarrett
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