AirAsia Group (AAGB) Q2 2024 earnings summary

Executive summary

• Revenue rose 30% year-over-year to RM669.1 million in Q2 2024, driven by a 42% increase in passengers and nearly 50% growth in ancillary income, despite seasonally weak demand and incomplete fleet activation.

• Net profit was RM4.8 million, marking the eighth consecutive profitable quarter, though slightly lower than last year due to MYR depreciation and higher jet fuel prices.

• EBITDA reached RM58.4 million, reflecting strong operational performance amid higher operating expenses and the absence of a one-off reversal seen in Q2 2023.

• Ancillary revenue per passenger increased 5% YoY to RM248, with total ancillary revenue up 48% YoY to RM218.2 million and contributing 33% of total revenue.

• Network expansion continued with new routes to Almaty, Nairobi, and strong FlyThru connectivity at 22%.

Financial highlights

• Scheduled flight revenue up 22% YoY to RM403.2 million; freight services up 35% YoY.

• EBITDA at RM58.4 million, down from RM100.5 million in Q2 2023 due to higher operating expenses and absence of prior year’s one-off reversal.

• Net profit of RM4.8 million, compared to RM5.5 million in Q2 2023, mainly due to currency depreciation.

• RASK improved 4% YoY to 15.19 sen; CASK increased 18% YoY to 13.90 sen due to a 40% rise in operational expenses; ex-fuel unit cost at 5.85 sen, maintaining the lowest among peers.

• Ancillary revenue per passenger: RM248 (+5% YoY).

Outlook and guidance

• Full fleet reactivation expected by year-end 2024, with 18 operational aircraft and further upside anticipated from Malaysian Ringgit appreciation and lower jet fuel prices.

• Additional aircraft activation and new routes to China, Africa (Nairobi), and Kazakhstan planned for H2 2024.

• Positive booking trends and strong fare/load factor resilience expected for the second half of the year.

• Ancillary revenue projected to grow with enhanced offerings and pricing strategies.

• Proposed acquisition of Capital A’s aviation business expected to complete by year-end, enabling immediate fleet growth.