Air Asia India, the Tata Sons-Air Asia Berhad JV, reduced its net losses by 13.65% y-o-y to Rs40.49 crore during the January-March quarter of 2017 on the back of forex gains. The low- cost airline had reported a net loss of Rs46.89 crore in the corresponding period last year. AirAsia follows a January-December financial year. Barring the foreign exchange gains the operating losses widened due to increase in fuel and staff cost. During the quarter, the airline made a foreign exchange gain of Rs11.92 crore compared to just Rs3.07 crore in the corresponding quarter. As a result of the increase in passenger flown and the additional services provided by the airline the total revenue for the quarter increased by a whopping 47.25 % y-o-y to Rs282.10 crore. While the ancillary revenue per passenger decreased to Rs418 during the period compared to Rs502 in the year ago period. The fuel cost – almost 40% of the total operating cost – increased by 26% y-o-y to Rs111.89 crore while the staff cost increased by 54.82% y-o-y to Rs64.59 crore during the quarter. As a consequence the net operating losses of the airline increased by 4.9% y-o-y to Rs52.41 crore as opposed to Rs49.96 crore in the year ago period.
Apart from the increase in the total cost, the average fare during the quarter decreased by 6.6% y-o-y to Rs2,983 due to steep discounting by other competitors in the domestic market. The subsidiary of Air Asia Berhad increased its total capacity by 30% y-o-y to 1012 million average seat kilometres (ASK) during the period and the passenger load factor also increased by 3 percentage points to 89% in the domestic market. According to the a statement issued by the parent company, Air Asia India will start its international operations by 2018 when it is expected to acquire 20 aircraft for its domestic operations.
“AirAsia Group is growing fast this year, adding 29 new planes this year for a total group fleet of 201 aircraft by end-2017 (127 excluding associates’ aircraft in Thailand, India and Japan). This is the most number of aircraft we have added in four years, demonstrating our confidence in the competitive environment in Asia,” said Tony Fernandes, Air Asia, group CEO in a statement issued. Currently, Air Asia Berhad holds 49% stake in the Indian subsidiary while the Tata sons have 51% stake in the airline after buying the 9% stake from Arun Bhatia.
Source: financialexpress.com