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Reuters
KUALA LUMPUR
Malaysian low-cost airline AirAsia Bhd reported a 30 percent drop in its quarterly net profit as higher fuel expenses overshadowed the effects of increased passenger numbers and an improvement in its load factor.
Asia's biggest budget airline is expanding and expects to achieve double-digit fleet growth this year to cater for rising demand for cheap travel in Asia.
Net profit for the first quarter ended March 30 fell to 615.8 million ringgit ($144 million) from a year ago while revenue rose 31 percent to 2.2 billion ringgit.
In January-March, AirAsia carried 9.15 million passengers, 6 percent more year on year and ahead of a 1 percent rise in seat capacity. The airline posted a load factor - a measure of how full planes are - of 89 percent for the period, 4 percentage points higher than a year ago.
The airline said in a statement on Thursday that despite revenue growth, net operating profit fell mainly due to the approximately 20 percent rise in average fuel price from $56 per barrel a year ago to $67 per barrel this quarter. Profit was also hit by a strong U.S. dollar during the quarter.
Additionally, total staff costs increased by 76.8 million ringgit from a year ago, due to the revised staff remuneration package introduced in the fourth quarter of 2016.
Group Chief Executive Officer Tony Fernandes said that the group's plan to sell non-core assets is on track.
