Air Asia posts first quarterly loss in two years

Low cost carrier AirAsia has recorded its first net loss in two years, citing currency exchange losses and higher taxes.

The loss for the three months to December amounted to almost 429 million Malaysia ringgit (£77.8 million).

The result compares to a RM169 million profit for the same quarter in 2013.

The annual profit for 2014 plunged to RM83 million from RM362 million the previous year.

The airline’s Flight QZ8501 crashed into the Java Sea in December with 162 people on board.

Adverse exchange rate movements, which went up by 7% year-on-year, resulted in unrealised foreign exchange losses on US dollar borrowings.

Coupled with higher taxation, AirAsia’s final quarter loss after tax stood at RM428.51 million.

The carrier faced restructuring costs during the year of moving to Klia 2 – the new Kuala Lumpur international airport.

Group chief executive Tony Fernandes said the December crash, which involved an Airbus A320-200 from its Indonesian subsidiary flying from Surabaya to Singapore, had caused a slight slowdown in demand at the beginning of the year.

“The devastating QZ8501 tragedy has impacted demand slightly in the beginning of the year but we are seeing it recovering well now,” he said. “The demand for the other associates however was not impacted by the incident.”

He added: “2014 was indeed a tough year for AirAsia Group. We faced so many challenges from the move to Klia2, the high fuel price, irrational competition, weakening regional currencies, the political situation in Thailand, floods in certain areas, kidnapping cases in East Malaysia to the devastating aviation tragedies.

“But over the years since inception, we have proven time and time again that AirAsia, through its resilient and robust model, is able to overcome these challenges and come out stronger – 2015 will be that year.”

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