KUALA LUMPUR: AirAsia X Bhd (AAX), the long-haul low-cost affiliate of AirAsia Bhd, saw its passenger volume, as measured by revenue passenger kilometres (RPK), decline 17% to 4.43 billion in the first quarter ended March (1Q) from 5.34 billion a year ago.
In a statement yesterday, AAX attributed the drop in RPK to capacity management and a slowdown in marketing activities during the first three months of this year following the crash of Indonesia AirAsia flight 8501 in December last year.
RPK is a measure of the volume of passengers carried by the airline. It is derived from the number of passengers multiplied by the number of kilometres these passengers have flown.
“Available seat kilometres (ASK) capacity [had also] decreased by 3% to 6.02 billion in 1QFY15 [from 6.22 billion a year ago], and consequently the load factor during the quarter had dropped 12 percentage points to 74% against 86% in 1QFY14,” AAX said.
ASK measures an airline’s passenger capacity, and is derived by the total seats flown multiplied by the number of kilometres flown.
In line with the airline’s turnaround strategy, which includes a network consolidation exercise for the first half of 2015, AAX said it had implemented frequency cuts on certain routes at the beginning of the year, affecting mainly China and Australia, and had concurrently terminated loss-making routes such as to Adelaide in Australia, and Nagoya in Japan, to optimise capacity.
The excess capacity from capacity management was redeployed to short-term wet lease and charter operations to maximise revenue, it added.
Moving forward, AAX said its current booking trends are in line with expectations for a recovery in the second half of 2015.
In terms of fleet movement, the airline took delivery of two Airbus A330-300s on operating leases in 1Q, bringing its total number of A330-300s to 25 compared with 19 a year ago.
On the performance of its associates, Thai AirAsia X registered strong loads of 82% for 1Q, with 155,961 passengers carried, implying continued positive pick-up for popular routes between Thailand, Japan and South Korea.
Thai AirAsia X currently operates three A330-300s, while Indonesia AirAsia X has two A330-300s serving Bali-Taipei and Bali-Melbourne respectively.
AAX (fundamental: N/A; valuation: N/A) shares closed down 5% to 28.5 sen yesterday, with a market capitalisation of RM1.2 billion.
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This article first appeared in The Edge Financial Daily, on May 19, 2015.