Capital A Berhad · MYX:CAPITALA
Capital A Berhad — AirAsia Group Berhad — Investor Day (April 2019)
37 slides from Capital A Berhad's investor day presentation, April 2019
Slide 1: AirAsia 3.0
AirAsia 3.0 Airline + Digital + Technology = The Travel & Financial Platform of Asean April 2019 1 Strictly private and confidential
Slide 2: Legal Disclaimer
LEGAL 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
Slide 3: Agenda
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms 3 Strictly private and confidential
Slide 4: AAGB share price since IPO
AAGB share price since IPO IPO price: RM1.25 FYE 2004: RM49mn PATAMI FYE 2018: RM1,980mn PATAMI 4 Strictly private and confidential
Slide 5: The largest LCC in Asia
The largest LCC in Asia The fourth largest airline in Asia 6 airlines 3 airlines 260 aircrafts, in 9 airlines 100 million passengers flown annually 500 million total passengers flown 147 destinations across 23 Countries Over 360 routes, including 98 unique routes 23 hubs Over 10,000 flights per week
Slide 6: Wide digital reach via AirAsia.com, mobile app and social media
Wide digital reach via AirAsia.com, mobile app and social media Over 11,900,000 fans Over 26,000,000 followers Over 7,900,000 followers Over Over560 million Over 40 million 1,600,000 followers annual unique (web&app) visitors mobile app download Over Hits from over 1,900,000 followers Over15 million
Slide 7: Ancillary revenue growth from data & digital initiatives
Ancillary revenue growth from data & digital initiatives 2008 2018 9x RM2.06bn RM0.23bn 9% of revenue 21% of revenue ✔ Baggage ✔ Baggage (dynamic pricing) ✔ Inflight F&B ✔ Inflight F&B ✔ Pick-a-seat ✔ Pick-a-seat (+ hot seats) ✔ Wifi ✔ Insurance ✔ Ourshop ✔ Fly-Thru ✔ Logistics 7 Strictly private and c
Slide 8: 1Q19 operating statistics
1Q19 operating statistics AirAsia Group (MAA, IAA & PAA): ● Carried 18% more passengers ● Load factor strong at 88% ● ASK up 11% as we added new routes and frequencies for both domestic and international routes to further grow market share 8 Strictly private and confidential
Slide 9: 1Q19 operating statistics
1Q19 operating statistics 9 Strictly private and confidential
Slide 10: Agenda
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms 10 Strictly private and confidential
Slide 11: We have the planes to grow to stimulate latent demand
We have the planes to grow to stimulate latent demand Equal Fleet Expansion Across AOCs in 2019 MAA TAA IAA PAA AAI AAJ Total January 2018* 84 56 23 17 14 2 196 December 2018** 95 62 24 22 19 2 224 6 countries: 2019 Net Addition*** 2 1 5 3 6 1 18 *January 2018 fleet for Malaysia excludes aircraft gro
Slide 12: Rational competition & growing market share across AOCs
Rational competition & growing market share across AOCs AirAsia’s Domestic Market Share & Rational Competition (2018 vs 2017) 6ppt 58% 2ppt 32% fla 2% 4ppt 20% 1pp 5% s s t s t 4 ppts 1 ppt 2 ppts 3 ppts FLAT 3 ppts 1 ppt 3 ppts FLAT 1 ppt 12 Strictly private and confidential
Slide 13: Agenda: Data-driven organisation
Agenda Data-driven organisation Achieving the unthinkable Strengthening our underlying airline business DATA USERS COE Digitalising the airline AirAsia 3.0 DATA GOVERNANCE Leveraging our data to create platforms 13 Strictly private and confidential
Slide 14: We have a lot of Data to drive ecosystem expansion
We have a lot of Data to drive ecosystem expansion BIG Data and Real-time Insights Engine & Component Contact Details FOMAX Transactions Online Activity Demographic Maintenance Feedback Loyalty Mobile Activity Aircraft Social Data Guests Speed Transactions Lifestyle Data Cabin Baggage Weight Feedbac
Slide 15: Data taking us to new heights
Data taking us to new heights Priorities Cost Reduction Revenue Gain to Focus On Verticals Operations Pricing / Promos / to Work On Fuel Cost Ancillary Efficiency Bundling Rewards Increase Increase Cost Drive Goals Fuel Cost Increase Drive More Efficiency & Customer to Achieve Efficiency Uptake Traffic
Slide 16: Staying true to being low-cost
Staying true to being low-cost Our top priority, ALWAYS. Lower Predictive Driving fuel usage New A321neo aircraft airport maintenance to reduction through that are fuel efficient & charges increase data analytics have lower cost per efficiency seat Adoption of ‘Agile’ Media cost on a organisation down
Slide 17: Agenda
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms 17 Strictly private and confidential
Slide 18: AirAsia 3.0
AirAsia 3.0 Strengthening our core airline 1 business ↑pax ↑ancillary ↑market share Digitalising the airline 2 ↑revenue ↓cost ↑insights Leveraging our data to 3 create platforms Guests Belly ↑revenue ↑users ↑engagement Cargo Baggage Travel Lifestyle Social Commerce e-Money Remittance Lending Our aim
Slide 19: Building blocks laid for a platform business
We are investing in people Building blocks laid for a platform business Lye Kong Wei, Elias Vafiadis, Nikunj Shanti, Group Head of Data Group Head of Software Engineering Group Head of Product (Formerly from Grab) (Formerly from Expedia) (Formerly from Expedia) AirAsia Software Engineering & Technolo
Slide 20: Agenda
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms 20 Strictly private and confidential
Slide 21: AirAsia.com - All-in One Travel and Lifestyle Marketplace
AirAsia.com - All-in One Travel and Lifestyle Marketplace New enhanced homepage UX/UI on web & mobile 21 Strictly private and confidential
Slide 22: AirAsia.com addressable market
AirAsia.com addressable market OUR VISION Asean internet economy market Now we are establishing AirAsia.com as a size (GMV, US$bn, all-in-one travel and lifestyle marketplace By sector 240 Ride-hailing (Online food delivery, ☑ Transportation 29 online transport) ☑ Food delivery Online media (Subscri
Slide 23: BigPay - Financial Supermarket
BigPay - Financial Supermarket Asia’s Money App ● Digital challenger bank for Southeast Asian millennials and travelers ● Democratise financial services with simple and affordable solutions for e-wallet, remittances, and lending 500k users e-Money Advanced money management Loans Remittance 23 Strictl
Slide 24: Belly Space Consolidation/Partnerships
AirAsia Group Belly Space Consolidation/Partnerships Existing cargo supply chain is ripe for disruption: AirAsia Group Belly Space Consolidation/Partnerships Jan 2019 Aug 2018 Feb 2019 May 2018 Jul 2018 2Q 2019 2Q 2019 In Conversation Full Year 2018 : Revenue of RM206 mil. Target for Full Year 2019
Slide 25: Building Teleport for businesses and consumers
Building Teleport to enable direct businesses and consumers Opening our logistics infrastructure to social sellers Social Commerce (C2C) is growing faster than ride-hailing in Asean ASEAN includes – MY, PH, TH, ID, VN, SG (ASEAN6) 2018-2025 Social commerce estimated at ~50% of formal e-commerce segm
Slide 26: Low customer acquisition cost built over two decades
Key to our platform strategy is our low customer acquisition cost built over the last two decades Asean internet Asean unicorns & funding in 2016-1H18 (US$bn) Active users, from economy market 2015 to 2018 size (GMV, US$bn, By sector 240 Ride-hailing (Online food delivery, Grab Go-Jek 10.1 8mn 35mn
Slide 27: AirAsia vs other platforms
AirAsia vs other platforms Market Dominance ASEAN Indonesia/ASEAN Global ASEAN Indonesia/ASEAN Visitors (per month) 65 million 22.2 million 750 million MAU: 18.6mn MAU: 28 million Daily active users ~2m 0.8mn n/a Ride-hailing: 4mn Ride-hailing: 1.8m Hotel nights for sales >500k >100k 352mn n/a n/a M
Slide 28: Thank you & Appendix
Thank you & Appendix 28 Strictly private and confidential
Slide 29: MFRS 16 impact
MFRS 16 • To reflect what was traditionally an off balance sheet long term commitment of entity to reflect it in the financial statements • No separate treatment for operating lease and finance leases. All treatment will reflect the same treatment like finance lease. Impact to P&L in 2019: • Impact post B
Slide 30: Aircraft monetisation exercise
Aircraft monetisation exercise 2019 BBAM 4Q18 results we recorded: transaction ● BBAM’s project consultants’ fees Nov 2018 RM167m Completion of ● accretion of interest catch up 79 aircraft and RM64m 14 engines ● net cash proceeds: RM4.4b where sold to BBAM we paid a special dividend totalling RM1.3b
Slide 31: FY2018 Financial Highlights
FY2018 Financial Highlights Financial Performance & Operating Statistics – AirAsia Group Berhad (“AAGB”) Revenue (RM mil) 10% 10,638 • Profitable despite average fuel price up by 33% (RM703 mil in additional fuel cost), resulting to 39% increase in fuel expenses Net Operating Profit (RM mil) 51% 808 •
Slide 32: Foreign currency, loans & fuel hedging
Foreign currency, loans & fuel hedging Our Strategy • Our Group’s fuel hedging strategy is based on our forward sales booking • Jet Kero – 52% hedged for FY2019 at USD79.40 per barrel; 40% hedged for FY2020 at USD77.55 per barrel. FY2021 4% at USD77.37bbl • Currency hedges – USD operating expenditur
Slide 33: Dividends
Dividends ● Committed to pay special dividends every 2 years ● Dividend policy of 20% of net profit ● Second interim dividend of 12sen/share payable on 10 April 2019 ● Interim + special dividend – totaling to RM0.64 for FY2018; 21.5% dividend yield ● Total dividends paid up over the years accounts fo
Slide 34: AirAsia.com Overview
AirAsia.com Overview Business Summary ● Incorporated in 2019, AirAsia.com is a regional web and mobile app CONTENT COMMERCE platform for travel and lifestyle bookings in Asia Creative Best deals visuals & for travel & ● Offers consumers travel and lifestyle products that are available for stories, s
Slide 35: BigPay Overview
BigPay Overview Business Summary ● Launched in 2018, BigPay aim to democratize financial services in Asia by building a digital bank that offers consumers e-wallet service, remittance and lending ● Value proposition includes easy user experience, usability via Mastercard’s extensive network, issuanc
Slide 36: Teleport Overview
Teleport Overview Business Summary ● Today, a consolidator of belly capacity for the AirAsia group of airlines, enabling cargo carriage for businesses across 110+ cities ● Global network reach through partner airlines beyond Asia covering US, Europe, Middle East and Australia/New Zealand ● Our goal
Slide 37: BigLife Overview
BigLife Overview Business Summary Products & Services ● Formally known as Big Loyalty and rebranded in 2019, BigLife is AirAsia’s frequent flyer program aiming to power AirAsia’s greater Points Earn & Burn ecosystem with its loyalty points as a high utility digital currency ● Earn and use points at