AirAsia Quarterly Profit Climbs Ninefold on Ticket Sales
AirAsia Bhd., Southeast Asia’s biggest discount airline, posted a ninefold gain in fourth- quarter profit as higher ticket sales and income from related services helped counter increased fuel prices.
Net income climbed to 316.6 million ringgit ($103 million), or 11.5 sen a share, from 33.9 million ringgit, or 1.4 sen, a year earlier, the Sepang, Malaysia-based carrier said in a statement today. Sales rose 33 percent to 1.19 billion ringgit.
AirAsia said it flew 11 percent more passengers in the quarter than a year earlier, and average fares increased 7 percent to 188 ringgit. Ancillary income, which includes sales of inflight food and baggage fees, more than doubled to 218.5 million ringgit.
“The company is in the best position, financially, that it has ever been in -- providing a strong foundation for further expansion and growth in 2011,” Chief Executive Officer Tony Fernandes said in the statement.
The carrier, which plans to issue dividends for the first time since listing in 2004, will make a decision on the matter in the next three weeks, Fernandes said on a conference call.
Costs for fuel and oil rose 21 percent in the quarter, AirAsia said. Average fuel prices climbed to $92 a barrel last year from $68 in 2009, it said.
AirAsia dropped 5.2 percent to 2.35 ringgit at the 5 p.m. close in Kuala Lumpur trading before the earnings were reported, on concern fuel costs will increase as crude oil prices rise. That was the stock’s lowest closing level since Nov. 12.
“We see earnings possibly at risk,” OSK Research Sdn. said in a report today before the results announcement. “Fuel represents as much as 30 percent to 35 percent of airlines’ expenses. No airline will be spared.”
To contact the reporter on this story: Chong Pooi Koon in Kuala Lumpur at pchong17@bloomberg.net
To contact the editor responsible for this story: Barry Porter in Kuala Lumpur at bporter10@bloomberg.net
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