Capital A Berhad · MYX:CAPITALA
Capital A Berhad — AirAsia Berhad — Q1 2015 Earnings Presentation
16 slides from Capital A Berhad's earnings presentation, May 28, 2015
Slide 1: AirAsia Berhad 1Q15 Earnings Briefing
AIRASIA BERHAD 1Q15 EARNINGS BRIEFING 28 MAY 2015 1
Slide 2: Disclaimer
DISCLAIMER Information contained in our presentation is intended solely for your personal reference and is strictly confidential. Such information is subject to change without notice, its accuracy is not guaranteed and it may not contain all material information concerning the Company. Neither we no
Slide 3: 1Q15 Key Financial Highlights
1Q15 KEY FINANCIAL HIGHLIGHTS 3
Slide 4: 1Q15 Key Highlights
1Q15 KEY HIGHLIGHTS MALAYSIA • Revenue of RM1.30 bil flat y-o-y mainly due to lower load factor due to absence of marketing • Operating profit of RM273.43 mil up 20% y-o-y • Net Income of RM149.33 mil up 7% y-o-y • EBIT Margin of 21% (up 4ppt) and EBITDAR margin of 39% (up 5ppt) • CASK down 13% y-o-
Slide 5: 1Q15 Key Highlights – Increased Profitability Despite Challenges
1Q15 KEY HIGHLIGHTS – INCREASED PROFITABILITY DESPITE CHALLENGES – LOWEST COST WINS AGAIN OPERATING PROFIT MALAYSIA +245% yoy • Double digit growth in profitability +56% yoy due to disciplined cost structure, despite load impacted due to the +20% yoy absence of marketing +0.4% yoy N/A • Average fare
Slide 6: 1Q15 Key Highlights – Ancillary Income
1Q15 KEY HIGHLIGHTS – ANCILLARY INCOME Connecting AA Fees Insurance 5% 9% F&B 9% RM Assigned Seats 47 Baggage 10% Per Pax 56% Cargo 11% • Overall ancillary revenue increased 7% yoy, pushing ancillary income per pax up by 2% to RM47 • Baggage remains the highest contributor at RM113.6mil (+4%) follow
Slide 7: Business Outlook
BUSINESS OUTLOOK • AIRLINE PASSENGER REVENUE • ANCILLARY INCOME • PRIVATE EQUITY INVESTMENTS 7
Slide 8: A More Rational Market
A MORE RATIONAL MARKET • MAS’s New CEO, Christoph Mueller on board May 1st • Steered the turnaround of Aer Lingus which was struggling when it was competing with Ryanair • We estimate MAS to cut around 20%-30% of capacity • Cancelled flights to Kochi, Kunming and Krabi – Good for AA • Started reduci
Slide 9: Group Sales Up 18% YoY
GROUP SALES UP 18% YoY 2Q15 WEEKLY SALES YOY GROWTH • Strong sales growth in the last 8 weeks Malaysia Thailand Indonesia Philippines Group especially in May as a result of the ’50% 100% Off Regional Campaign’ 80% • China demand is recovering 60% 40% • Group: +18% yoy 20% 0% • Malaysia: +21% yoy -20
Slide 10: Favourable Cost Environment
FAVOURABLE COST ENVIRONMENT 1Q15 : CASK down 13% YoY, CASK-ex Fuel down 9% YoY • Average fuel price is down 20% YoY which led to 9% reduction in acft fuel expenses • Other operating expenses reduced by 21% YoY POSITIVE FUEL ENVIRONMENT LOWER AIRPORT CHARGES • Current hedge position: • Announced Lang
Slide 11: Growing Cash Further
GROWING CASH FURTHER • In good cash position (RM1.6bil – up 20% QoQ). No plans on raising money from equity market • 87% of the Group’s aircraft are owned, 128 aircraft are on Malaysia’s balance sheet • Growing cash via capacity m’ment (refinancing older aircraft eg.SLB & selling of vintage aircraft
Slide 12: Turning Around Indonesia
TURNING AROUND INDONESIA 2015 2014 (same period) • Upward load trend QoQ 76% • Weekly sales almost back to same level as last 70% year. Floor price is a challenge 62% 56% • Should see RASK upside in May • Target to be profitable in 3Q15 • Newly launched IAAX will be huge catalyst • To open new hubs
Slide 13: Turning Around Philippines
TURNING AROUND PHILIPPINES 2015 2014 (same period) • Target to be profitable in 4Q15 & continue to 81% 80% remain cash +ve 70% • Open new hubs to take advantage of new 66% airport development. Potentially basing aircraft in Boracay and Puerto Princessa in 2016 43% • Fleet – target 2-3 acft p.a. in n
Slide 14: Ancillary Income – RM50 in 2015
ANCILLARY INCOME – RM50 IN 2015 DYNAMIC PRICING AirAsia EZPay – CURRENCY WALLET • Introduce dynamic pricing • Prepaid solution operated in closed loop • Vary price on seasonality, route or time of day payment network. Eliminates acquiring • Discounts for BIG members/special promo bank charges, lower
Slide 15: Extracting Values from Assets
EXTRACTING VALUES FROM ASSETS LEASING HOUSE • Currently 100% subsidiary of AAB, potential investors to come in • 1Q15: US$3.18mil of Revenue, US$490k of PBT, EBIT Margin of 15% • Forecast to generate ~US$17mil of PBT in 2015, ~US$44mil in 2016, ~US$46mil in 2017 • Forecast EBIT Margin of 25% in 2015
Slide 16: Thank You
2014 PASSENGERS CARRIED U5, Outi LOAD Wy: bs yp 56 NATIONALITIES NETWORK 199 ROUTES + 17 HUBS = 69 UNIQUE ROUTES = 33 MEW ROUTES INTRODUCED IM 2014 98 DESTINATIONS 17 COUNTRIES 3,488 ONE-WAY FLIGHTS PER WEEK 18.3 Sols @).... So MILUON FANS 222 e | 163,000| G4 IA ANNUAL 172 MIL | 11 MIL wae") Stesaon