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Malaysia's AirAsia sees 2020 capacity at 45-60% of 2019 levels on virus hit
[KUALA LUMPUR] Malaysia's flagship budget carrier AirAsia Group expects its 2020 capacity to be just 45-60 per cent of last year's levels due to the coronavirus outbreak and to fill 70-75 per cent of seats this year compared with the usual 85 per cent.
The forecast was released in a presentation posted on the airline's website on Tuesday, a day after it reported its biggest first-quarter loss since it listed on the Malaysian bourse in November 2004, according to Refinitiv Eikon data.
AirAsia expects travel demand to rebound to an extent in 2021, with capacity reaching 85 per cent of its 2019 levels and load factor, a measure of the percentage of seats filled, returning to 85 per cent in 2021, according to the presentation.
AirAsia posted a loss of 803.3 million ringgit (S$261.1 million) for the quarter ended March, from 96.1 million ringgit net profit in the year-ago period. Revenue fell 15 per cent to 2.31 billion ringgit.
AirAsia shares were down 2.8 per cent at 5.45am GMT (1.45pm SGT) on Tuesday.
The company management had guided that an equity raising via a placement or rights issue looked imminent, Affin Hwang Capital analyst Isaac Chow wrote in a note.
AirAsia last month said it had received proposals from investment bankers, lenders and potential investors to help cope with the pandemic.
It said on Monday it had ongoing deliberations for joint-ventures and collaborations that might result in additional third party investments in specific segments of the group's business.
Demand was positive since the carrier gradually restarted domestic routes after grounding most of its fleet in March due to movement restrictions to contain the coronavirus, AirAsia added.
The company had sought payment deferrals from suppliers and lenders to ensure sufficient working capital and had restructured a major portion of its fuel hedges, chief executive Tony Fernandes said in a statement on Monday.
AirAsia has also applied for bank loans in countries it operates in to shore up liquidity, the statement said.