Tag Archives: AirAsia

Auditor: AirAsia’s future in “significant doubt”

The external auditor of AirAsia (Ernst and Young) has raised significant doubts about budget airline AirAsia as a going concern.

According to the report, AirAsia’s current liabilities already exceeded its current assets by 1.84 billion ringgit ($430 million; £340 million) at the end of 2019, before the start of the COVID-19 pandemic.

Trading in AirAsia were suspended.

Read more from the Nikkei Asian Review.

AirAsia issued this statement:

AirAsia Group Berhad wishes to draw attention to our latest update where AirAsia’s external auditors, Messrs Ernst & Young PLT issued an unqualified audit opinion with an emphasis of matter on material uncertainty relating to going concern in respect of the Company’s audited financial statements for the financial year ended December 31, 2019.

The unqualified audit opinion states that the financial statements of AirAsia for the financial year ended December 31, 2019 are true and fair and in compliance with financial reporting standards and statutory requirements, in all material aspects.

The emphasis of matter highlights that there are significant uncertainties with respect to the Company’s ability to continue as a going concern as a result of the unprecedented COVID-19 pandemic. Nevertheless, it is important to note that the financial statements have been prepared on a going concern basis, as the Board of Directors is confident of the successful continuation of the business, in conjunction with the actions undertaken by the governments of the operating entities, outcome of ongoing discussions with financial institutions and investors to obtain required funding and implementation of management’s action plans, in response to the conditions above.

In this regard, the auditors’ report should be read in full and can be found in the annual audited accounts that is available on the Company’s Investor Relations website.

Domestic rebound demand is strong; Optimistic of re-opening of international travel

AirAsia Group Berhad CEO, Tan Sri Tony Fernandes said “The first half of 2020 has been extremely challenging. However, in recent weeks, countries around the world have resumed domestic travel and are gradually reopening international borders in recognition that air transport provides the connectivity that is essential for the resumption of economic activities. The formation and discussion of “travel bubbles” and “green lanes”  with key economic partners with a low infection rate and proven pandemic curbing systems, is a step in the right direction.

“As domestic travel is now allowed in Malaysia, Thailand, Indonesia, India and the Philippines, we have been resuming our flights on a staggered yet steady basis since late May. In support of governments’ efforts to revive domestic tourism and ultimately stimulate economic recovery, AirAsia has aggressively launched large-scale promotions and sales campaigns. I am encouraged by the higher-than-anticipated sales this has generated.  On July 7, 2020 we registered our highest post-hibernation sale with 75,000 seats sold in a single day, reflecting pent-up demand and signalling green shoots of recovery. We also sold over 200,000 AirAsia Unlimited Passes since its recent launch for domestic Malaysia, domestic Thailand and AirAsia X.

“Positive trends in our flight bookings and load factors are additional signals of a better second half of the year. In June, our group-wide load factor was 60% with AirAsia Malaysia’s load factor reaching 65%. For July, we expect to achieve a higher load factor of 70% despite tripling our capacity month-on-month to cater to the increased demand.

“Teleport, the profitable technology-meets-logistics venture of AirAsia, accelerated its regional growth despite a challenging environment, growing 49% year-on-year in the first quarter of 2020. This growth was supported by a strong emphasis on transporting medical aid and critical supplies at a time of need. In addition, despite the complete hibernation of the airline group, Teleport pivoted from delivering cross-border e-commerce to last mile deliveries, delivering more parcels, restaurant orders, and fresh produce during the movement control period than in the previous 12 months collectively. With the launch of Freightchain, the world’s first digital cargo platform built on blockchain, the re-launch of OURSHOP as an e-commerce marketplace to support the local businesses we love, and rollout of OURFOOD a fuss-free platform to bring all types of food businesses online, Teleport has emerged with even stronger growth prospects for the second half of 2020.

“As a great believer in Asean, we remain confident in the growth potential of the region. In IMF’s latest World Economic Outlook, Asean-5’s GDP growth is expected to rebound strongly to 6.2% in 2021, one of the highest growth rates in the world. We’re confident that AirAsia will not only benefit from this growth upturn but also contribute to the region’s recovery given the significant role that air connectivity plays in Asean’s trade and investment landscape.”

On funding…

“We understand the importance of shoring up our liquidity to ensure sufficient cash flow. We have been presented with proposals in various forms of capital raising, be it debt or equity, and are in ongoing discussions with numerous parties, including investment banks, lenders, as well as interested investors in seeking a favourable outcome for the group. We have received indications from certain financial institutions to support our request for funding, amounting to more than RM1.0 billion. Of this debt funding, a certain portion would be eligible for the government guarantee loan under the Danajamin PRIHATIN Guarantee Scheme in Malaysia. Other than Malaysia, our Philippine and Indonesia entities are currently in various stages of bank loan applications. In the Philippines, we have applied for the government guaranteed loan under the Philippine Economic Stimulus Act (PESA), with an expected positive outcome.”

On working capital management,…

“During the hibernation period, we have taken significant measures internally as a group while also reaching out externally for assistance to ensure our working capital remains intact.

“Internally, we have embarked on headcount rationalisation for leaner operations, given the current demand for air travel and expectations on recovery. Internal cost-cutting efforts include a group-wide temporary salary reduction of between 15% – 75%.

“We have received deferrals from our supportive lessors and are now working on further extensions. We have also restructured 70% of our fuel hedging contracts and are continuously negotiating with our supportive counterparties for the remaining exposure.

“All in all, we expect at least 50% reduction in our cash expenses in 2020.

“In conclusion, the impact of Covid-19 pandemic on the Company is never taken lightly, as does the trust and support put into us. The management has been working tirelessly to ensure the sustainability of our business operations. With the confidence of our stakeholders and business partners, we are determined to move forward in this new normal. We are positive that the proactive mitigating actions we have implemented as well as our consistency in transforming the Company would aid us in recovering and overcoming this operating environment.

“In times of difficulties lies opportunities.  We have weathered many crisis and emerged stronger. We won’t waste this crisis and we will come out stronger.”

AirAsia aircraft photo gallery:

AirAsia aircraft slide show:

https://airlinersgallery.smugmug.com/frame/slideshow?key=vgMtmd&speed=3&transition=fade&autoStart=1&captions=0&navigation=0&playButton=0&randomize=0&transitionSpeed=2

A message from AirAsia’s Tony Fernandes, 96% of the fleet grounded

AirAsia issued this statement from the CEO:

When Kamarudin and I started AirAsia nearly 20 years ago, we had a dream of allowing everyone the opportunity to fly. Sadly, that opportunity has now been taken away from us for now.

It’s an uncertain time. Never could I have imagined it, no one could have predicted it and yet everyone has been touched by it. So I want to be open and transparent with you in this time of uncertainty.

There’s no denying that our industry has been hit hard, and we are no exception. This is possibly the biggest challenge we have ever had to face. We have no revenue coming in, 96% of our fleet is grounded and we still have significant ongoing financial commitments such as fuel suppliers and leasing agents.

We are doing everything possible to reduce costs during this time so we can come back fighting as fast as possible and continue to be the world’s best low cost carrier, enabling everyone the ability to fly with our great value and service.

We are one of the few airlines world over who has kept all of our staff on. AirAsia is a family and there are tens of thousands of Allstars who depend on the business for their livelihoods and the wellbeing of their own families. Kamarudin and I will not be taking a salary during this period and Allstars from across the business have accepted temporary pay reductions of anywhere between 15-75%,depending on seniority, to share the impact this is having on our business. I thank them for their sacrifice and in keeping the big picture in mind as we navigate this together.

In spite of all these challenges, I want to assure you that AirAsia is strong and remains firmly focused on the future and serving you, our guests . I also want to express my heartfelt thanks and appreciation to all of you for your loyalty to AirAsia and I hope that you and your loved ones are healthy and well throughout this trying time. I’m truly sorry that many of your travel plans have been affected. Like all airlines, AirAsia had no choice but to cancel a large number of flights due to government restrictions in an effort to contain the spread of COVID-19.

I know many of you have expressed frustration with not receiving a refund for your flights but I encourage you to accept a credit as a good alternative. More than 80 percent of you have accepted our credit offer and we truly appreciate this. Please know that our policy is in line with many operators in the travel industry and reflects our focus on coming out the other side of this difficult period and flying with you again as soon as possible. We have ensured that we adhere to all regulations and requirements of respective governments and consumer authorities and believe this is the best solution. You are among the over 600 million guests who have flown AirAsia and can’t wait to fly with you again once this is over.

While we strongly encourage you to accept the credit which is instant and comes with a 365-day validity and allows you to change your flight date for an unlimited number of times, we do accept requests for refund on a case by case basis. However, due to the overwhelming number of requests that we have received, it may take a long process of between 12 to 16 weeks.

I also want to acknowledge the comments I’ve seen about our virtual Allstar AVA. Please know that we take your feedback seriously and my team is making improvements to the system daily. Currently our team and AVA are handling 10 times the normal volume of queries, which is now at about half a million guests on a daily basis.

We are working tirelessly, around the clock, to provide assistance to each and every one of you. We’ve mobilised additional support to our customer happiness team, including 1,800 Allstars from other functions, who have rolled up their sleeves and volunteered to help, so more live agents are available to assist you via our LiveChat, Facebook Messenger, Twitter & WeChat 24/7.

We’ve never had a time like this before and we are doing our best. We are not always perfect but we strive to do all we can for our people and our customers at all times. This is unprecedented but it is also temporary and we will be back, stronger than before, repainting the skies red and making sure everyone can fly again.

Until then…

Stay home. Be safe. And look to the future.

#InThisTogether

Lots of love,

Tony

AirAsia (Malaysia) aircraft photo gallery:

AirAsia orders more Airbus aircraft

AirAsia has signed two major agreements with Airbus, covering the order of an additional 12 A330neo and 30 A321XLR aircraft, as well as a memorandum of agreement to support the development of the Malaysian aerospace industry.

As part of the deal, Airbus will expand its maintenance, repair and overhaul (MRO) presence in Malaysia and establish the Airbus Malaysia Digital Initiative to enhance the competitiveness of the local aerospace sector through the application of new digital technologies, in line with the government’s vision to make Malaysia a regional aerospace hub.

Airbus will also boost its commitment to the Aerospace Malaysia Innovation Centre (AMIC) – of which it is a founding member – by appointing an Innovation Technical Director and increasing its funding for joint research programmes, including into the production of sustainable aviation biofuels in Malaysia.

The agreements were signed by Airbus CEO Guillaume Faury and Tan Sri Rafidah Aziz, Chairman of AirAsia X Berhad for the aircraft purchase and Datuk Kamarudin Meranun, Executive Chairman of AirAsia Group Berhad for the industrial projects.

The signing ceremony was witnessed by Tun Dr Mahathir Mohamad, the Prime Minister of Malaysia. Also present was AirAsia Group CEO Tan Sri Tony Fernandes.

Airbus is the largest international partner for the Malaysian aerospace industry. Its sourcing and services businesses in the country are now valued at some US$400 million per annum for the local economy, a figure expected to rise to more than US$550 million every year with these new initiatives.

AirAsia also signed an agreement for a firm order of 12 additional Airbus A330neo aircraft, (taking the total from 66 to 78 A330neos on order) and 30 state-of-the-art A321XLR aircraft, to join AirAsia’s future long-haul fleet. The introduction of the A321XLR provides AirAsia X with greater flexibility to better manage capacity on key routes as well as respond to seasonal demand. The A321XLR also gives AirAsia X an advantage when it comes to exploring opportunities to operate non-stop flights between Southeast Asia and secondary cities in countries like Australia, China and Japan.

AirAsia upsizes Airbus A320neo order to larger A321neo

 

AirAsia will upsize its future Airbus single aisle fleet, converting 253 orders for the A320neo to the larger A321neo version. The change will enable the airline to offer higher capacity in response to ongoing strong demand across its network. AirAsia becomes the world’s largest customer for the A321neo.

In total, AirAsia has placed orders for 592 A320 Family aircraft. Following the upsizing, AirAsia’s backlog with Airbus includes 353 A321neo. To date, the airline has taken delivery of 224 A320 Family aircraft, flying out of its bases in Malaysia, India, Indonesia, Japan, the Philippines and Thailand.

Image: Airbus.

AirAsia signs Memorandum of Cooperation for Vietnam JV

Top Photo: AirAsia. AirAsia Group CEO Tony Fernandes (front center left) shakes hands with Tran Trong Kien, CEO of Thien Minh Travel Joint Stock Company CEO and General Director of Hai Au Aviation Joint Stock Company, after the memorandum signing witnessed by Vietnamese Deputy Prime Minister Vu Duc Dam (center right) and Vietnamese Deputy Minister of Culture, Sports and Tourism Le Quang Tung (centre left), flanked by the Vice Chairmen of the Vietnamese Advisory Council to the Prime Minister on Administrative Procedures Reform, VinaCapital Group CO-Founder and CEO Don Lam (far left) and FPT Corporation Co-Founder, Chairman and CEO Truong Gia Binh (far right), who is also Chairman of Vietnam’s Private Sector Development Committee.

AirAsia (Malaysia) has made this announcement about a new joint venture in Vietnam:

AirAsia has signed a Memorandum of Cooperation reaffirming its intention to set up a low-cost carrier in Vietnam with local partners.

The memorandum was signed by AirAsia Group CEO Tony Fernandes and Vietnamese businessman Tran Trong Kien, in his capacity as CEO of Thien Minh Travel Joint Stock Company (TMG) and General Director of Hai Au Aviation Joint Stock Company (HAA), at the InterContinental Hanoi Landmark72 on December 6, 2018.

The signing, conducted on the sidelines of the Vietnam Travel and Tourism Summit 2018, was witnessed by Vietnamese Deputy Prime Minister Vu Duc Dam and Vietnamese Deputy Minister of Culture, Sports and Tourism Le Quang Tung.

AirAsia Group CEO Tony Fernandes said, “AirAsia is an Asean airline. And in Asean, Vietnam is one of the last remaining countries with a large population we’re not in. Today’s memorandum reaffirms our commitment to making AirAsia in Vietnam happen. Last year, when we announced this JV, we were bullish about Vietnam and we remain incredibly bullish about serving one of the most dynamic, fastest-growing economies in Asia.

“AirAsia is already the largest foreign airline group in Vietnam by capacity. We currently operate to five destinations here, including our most recent addition, Phu Quoc. And we will continue to expand our network to connect Vietnam to Asean and beyond, something our local JV will be able to accelerate. We couldn’t be more excited about the prospect of bringing more visitors to this amazing country and delivering true low-cost air travel to 95 million Vietnamese in the near future.”

TMG CEO and HAA General Director Tran Trong Kien said, “Vietnam tourism has performed extremely well. The number of international arrivals has doubled over the last three years and domestic and outbound travel have also grown tremendously. The sector has contributed greatly to recent economic development and social progress. Vietnam as a country needs better connectivity to continue this trend and for tourism to reach its full potential. Adding a new airline, especially at this stage and with an experienced operator like AirAsia, is a much needed and welcomed move. This new airline will bring more and better choices to our people in the years to come.”

AirAsia operates 141 return flights weekly on 13 routes – including six unique routes – connecting Hanoi, Ho Chi Minh City, Da Nang, Nha Trang and Phu Quoc with Kuala Lumpur, Penang and Johor Bharu in Malaysia, Bangkok and Chiang Mai in Thailand and Manila in the Philippines, and has carried 12 million passengers to and from Vietnam since entering the market in 2005.

AirAsia paints the skies (RED), featuring 88rising, with a new logo jet

(AirAsia)RED

AirAsia has made this announcement:

AirAsia is proud to announce our partnership with (RED)® in support of the Global Fund to fight AIDS in Asean.

The funds generated from the (AirAsia)RED partnership will go directly to the Global Fund to support HIV/AIDS programs in Southeast Asia, home to nearly 1.8 million people living with HIV, according to 2017 UNAIDS data.

AirAsia has pledged proceeds from its current Free Seats promotion and various activities planned for 2019.

For every seat sold on airasia.com and the AirAsia mobile app until noon on Wednesday (GMT +8), AirAsia will donate 20 US cents, enough to buy one day’s worth of live-saving antiretroviral treatment for someone living with HIV.

In addition, AirAsia and (RED) will be collaborating with leading global Asian music label, 88rising, to launch a new Asean music and arts festival in 2019 to drive positivity and awareness of HIV/AIDS in the region. Dates, location and line-up will be announced at a later date.

The partnership was announced at the unveiling of a special (WEAREALLCHAMPIONS)RED livery at Sepang Aircraft Engineering (SAE). Guests were treated to a live performance by Los Angeles-based rapper Dumbfoundead, an 88rising collaborator who performed at their recent Head in the Clouds festival in the US.

The event was attended by Malaysian Minister of Health Datuk Seri Dr Dzulkefly Ahmad, Malaysian Youth and Sports Minister Syed Saddiq Syed Abdul Rahman, Malaysian AIDS Foundation (MAF) Malaysian Business Consortium on HIV/AIDS Manager Dr Rethish Raghu, MAF Advocacy Manager Dayana Omar, (RED) CEO Deborah Dugan, 88rising Founder and CEO Sean Miyashiro, AirAsia Group CEO Tony Fernandes and AirAsia Group Head of Branding Rudy Khaw, among others.

(RED) CEO Deborah Dugan said, “We couldn’t be more excited to partner with such a creative and innovative brand like AirAsia! Loved by millions and committed to making a real difference in Southeast Asia, the (AirAsia)RED partnership is literally taking the AIDS fight to new heights.”

88rising Founder and CEO Sean Miyashiro said, “88rising is absolutely over the moon with the idea of an amazing music and arts festival in Asean that empowers a young audience to save lives. All of 88rising will put all of our creative minds together to make this experience one of a kind, while creating massive awareness and engagement to a globally minded audience.”

AirAsia Group CEO Tony Fernandes said, “AirAsia has always been about making the impossible possible. Today’s global partnership is all about championing new opportunities, both for those living with HIV/AIDS and in terms of bringing a broader message of positivity and change to the Asean. And this is just the beginning. We have many more things planned with (RED), with support from 88rising, to supercharge outreach in the region, so watch this space.”

All images by AirAsia.

AirAsia launches Airbus A330 UFC branded livery to celebrate UFC partnership

AirAsia has launched the first UFC – branded livery on an AirAsia Airbus A330-300.

The aircraft is the first of its kind in the world to feature UFC branding and is sure to capture the attention of travelers all over the world.

AirAsia Group Head of Branding Rudy Khaw added: “We are pleased to unveil this special livery as the Official Airline of the UFC in Asia. Fight fans have been eagerly awaiting the return of UFC to Singapore, and we are thrilled to be able to present Cowboy vs Edwards for their enjoyment.”

Speaking of the launch, Vice President of Asia Pacific at UFC Kevin Chang said: “This is a special moment for our valued partner AirAsia and UFC. We’re committed to growing the brand and sport in Asia, and this collaborative partnership will continue to help us do that. We have a Fight Night in Singapore in less than a month, and this branded aircraft will add to the excitement of fans traveling there.”

Come June 23, fans can expect a world-class MMA event with athletes from around the world. A truly international fight card, UFC® FIGHT NIGHT SINGAPORE: COWBOY vs. EDWARDS presented by AirAsia boasts athletes from Australia, Brazil, China, England, Japan, Mexico, Philippines, Russia and the United States.

Photos by AirAsia.

 

Financial Times: AirAsia CEO pledges to prove that airline critics are wrong

AirAsia (Malaysia) (Kuala Lumpur) CEO Tony Fernandes (below) is fighting a critical report by the independent research firm GMT. The report, according to this story by The Financial Times, states the airline is “teetering on default”.

AirAsia CEO Tony Fernandes Time 100

Above Photo: AirAsia. Time Magazine previously proclaimed CEO Tony Fernandes as one of the Top 100 Most Influential People in the World.

 

This interesting read also explains the intricate financing of the group and lays out in a graph how the group is owned and financed.

AirAsia circle logoThis story is recommended.

Read the full report: CLICK HERE

AirAsia Taylor Swift Red Tour (AirAsia)(LR)

Photo Above: AirAsia. AirAsia in 2014 partnered with U.S. singer Taylor Swift and became the official airline for her Red Tour in Asia.

Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. In conjunction with the 2014 Red Tour, AirAsia decorated this Airbus A320-216 9M-AHM (msn 3536) with the image of Taylor Swift.

AirAsia aircraft slide show: AG Airline Slide Show

AG Ad - Captain's Log 5.2015 (LRW)

AirAsia India unveils a logo jet in tribute to Indian aviation pioneer J.R.D. Tata

AirAsia (India) A320-200 VT-JRT (15-The Pioneer)(Drawing)(AirAsia)(LRW)

AirAsia India (Chennai) yesterday (March 21) celebrated the unveiling of Airbus A320-216 VT-JRT (msn 3448, ex OK-NES) (below). The unique livery is a tribute to Indian aviation pioneer J.R.D. Tata with a Puss Moth, the aircraft he flew on October 15, 1932, leading to the start of Tata Airlines and the start of aviation in India.

“The Pioneer” is the fourth Airbus A320 for the new airline which commenced scheduled passenger operations on June 12, 2014.

AirAsia (India) A320-200 VT-JRT (15-The Pioneer)(Grd)(AirAsia)(LR)

AirAsia (India) A320-200 VT-JRT (15-The Pioneer)(Grd-1)(AirAsia)(LR)

All photos and images by AirAsia India.

Video:

Below Photo: AirAsia India. Mr. Ratan Tata is pictured signing his photo mural in the cabin of VT-JRT during the event.

AirAsia India Ratan Tata signing photo on VT-JRT (AirAsia India)(LRW)

Will the Skymark reorganization pick the ANA proposal or AirAsia?

ANA (All Nippon Airways) today (February 23) submitted a bid to sponsor the reorganization of Skymark Airlines (Tokyo-Haneda). Today was the deadline set by Skymark’s financial adviser for any airline companies to submit any proposals to rescue the troubled airline according to ZipanguFlyer. In essence, ANA wants to reorganize Skymark as a feeder for ANA. A competing previous bid by AirAsia (Kuala Lumpur) would keep Skymark independent and would allow it grow its presence in Japan. Which way will Skymark and the court go?

Read the full report: CLICK HERE

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Skymark Airlines will reorganize around the Boeing 737. Boeing 737-86N JA737R (msn 35630) approaches the runway at Narita International Airport near Tokyo.

Skymark aircraft slide show: AG Airline Slide Show

AG Thank you