Malaysia’s AirAsia X posts record quarterly loss, eighth in a row
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Malaysian long-haul budget airline AirAsia X Bhd reported a record loss for the first three months of the year and its eighth quarterly loss in a row as the coronavirus pandemic devastated demand for air travel.
The airline, an affiliate of AirAsia Group Bhd on Thursday reported a net loss of 5.67 billion ringgit ($1.37 billion) in January-March, more than 10 times the loss of 549.7 million ringgit seen in the same period last year.
The loss was primarily attributable to the impairment of assets, it said in a statement.
AirAsia said it has assessed the recoverability of its assets in light of the COVID-19 pandemic and its restructuring process and impaired those assets by 5.28 billion ringgit.
The airline has been looking to reconstitute 64.15 billion in debt, and said the asset impairment does not impact the restructuring.
“Appropriate accounting entries will be made on a successful restructuring that will reflect more appropriately the assets and liabilities based on the final agreed restructuring terms,” it said.
It also said it remains committed to resuming commercial operations as soon as possible on the successful completion of the restructuring plan and the opening of international borders.
The airline has changed its financial year-end from Dec. 31 to June 30, expecting the outcome of the restructuring to be known then. It said the basis of preparation for its audited financial statements will clear and be of more value to shareholders at that point.
Questions & Answers
Q.What was the main reason for AirAsia X's record loss this quarter?
What was the main reason for AirAsia X's record loss this quarter?
The primary reason for the record loss was the impairment of assets. AirAsia X assessed the recoverability of its assets due to the pandemic and restructuring process, impairing them by 5.28 billion ringgit.
Q.Does the asset impairment affect AirAsia X's ongoing debt restructuring efforts?
Does the asset impairment affect AirAsia X's ongoing debt restructuring efforts?
No, the asset impairment does not impact the restructuring process. The airline is still looking to reconstitute 64.15 billion in debt, and appropriate accounting entries will be made later.
Q.When does AirAsia X expect to resume its commercial flight operations?
When does AirAsia X expect to resume its commercial flight operations?
AirAsia X is committed to resuming commercial operations as soon as possible. This will happen once the restructuring plan is successfully completed and international borders reopen for travel.
Q.Why has AirAsia X changed its financial year-end date?
Why has AirAsia X changed its financial year-end date?
The airline changed its financial year-end from December 31 to June 30. This was done as it expects the outcome of the restructuring to be known by then, providing more valuable financial statements to shareholders.
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