Capital A Berhad · MYX:CAPITALA

Capital A Berhad — AirAsia Berhad — Q1 2008 Earnings Presentation

26 slides from Capital A Berhad's earnings presentation, May 29, 2008

  1. Slide 1: Jan-Mar Quarter 2008 Results

    Jan-Mar Quarter 2008 Results 29 May 2008

  2. Slide 2: Disclaimer

    Disclaimer Information contained in our presentation is intended solely for your reference. 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 nor our advisors make any representation

  3. Slide 3: Key Highlights

    Key Highlights ‰ Delivered profit growth and margin expansion – EBIT RM73 million with margins of 13.7% – Net income RM161 with margins of 30.1% ‰ 25th consecutive quarter of profitability – the only LCC in Asia that is making money – one of the few airlines that managed to grow profits in the perio

  4. Slide 4: Key Highlights for Jan-Mar Quarter

    Key Highlights for Jan-Mar Quarter ‰ Continuously expanding the route network – introduced 13 routes since the beginning of the year – launched Bali as a new base ‰ On-time performance of 87% ‰ Listed as the world’s 43rd most Innovative Brand in the world ‰ Deployed Airbus to Thai AirAsia – Thai Air

  5. Slide 5: Consistent Passenger Growth

    Consistent Passenger Growth Passengers Flown by AirAsia and AirAsia Associates (‘000) 15,335 12,107 R 57% G CA 7,370 Y oY wth gro 4,868 26 % 4,361 3,460 2,094 1,041 2002 2003 2004 2005 2006 2007 Q 1- 2 0 0 7 Q 1- 2 0 0 8 5

  6. Slide 6: Perpetually Expanding Route Network

    Perpetually Expanding Route Network Period # Routes Served Jan 2002 6 Jun 2003 11 Jun 2004 26 Jun 2005 52 Jun 2006 65 Jun 2007 75 NOW 102 Latest Routes KL – Hong Kong KL – Haikou KL – Ho Chi Minh City Upcoming Routes KL – Makassar KL – Tiruchirapalli 6

  7. Slide 7: Results Commentary

    Results Commentary

  8. Slide 8: Superior Growth with Expanding Profits

    Superior Growth with Expanding Profits R e v e n u e (R M m i l l i on ) PROFIT MARGINS 32% 535 EBITDAR 31.3% 24.4% 406 Jan-Mar 2007 Jan-Mar 2008 EBIT Jan-Mar 2007 Jan-Mar 2008 17.9% N e t In com e 13.7% (R M m i l l i on ) 161 86% Jan-Mar 2007 Jan-Mar 2008 Net Income 87 30.1% 21.4% Jan-Mar 2007 Jan

  9. Slide 9: Profitability Enhancement

    Profitability Enhancement Rev / ASK (sen) 12.32 12.27 ¾ 10% Higher average fare ¾ Higher ancillary income contribution Jan-Mar 2007 Jan-Mar 2008 Cost / ASK (sen) 5% 10.58 ¾ Unit Fuel price climbed by 43% 10.06 to USD110/barrel ¾ Fuel hedge benefits RM8 million Jan-Mar 2007 Jan-Mar 2008 Net Income (R

  10. Slide 10: Profitability Enhancement

    Profitability Enhancement Rev / ASK (US ¢) 6% 3.82 3.61 ¾ 10% Higher average fare ¾ Higher ancillary income contribution Jan-Mar 2007 Jan-Mar 2008 Cost / ASK (US ¢) 15% 3.30 ¾ Unit Fuel price climbed by 43% to USD110/barrel 2.87 ¾ Fuel hedge benefits RM8million Jan-Mar 2007 Jan-Mar 2008 Net Income (

  11. Slide 11: Cost / ASK – year on year Comparison

    Cost / ASK – year on year Comparison Cost Breakdown Jan-Mar Jan-Mar ∆ (%) (US cents / ASK) 2008 2007 Reason Staff Costs 0.32 0.34 (5%) Improved productivity Fuel and Oil 1.93 1.44 34% Higher jet fuel price Productivity benefits of higher User & Station Charges 0.24 0.25 (5%) capacity Airbus A320 Mai

  12. Slide 12: Year on Year Comparison (Malaysia)

    Year on Year Comparison (Malaysia) Operating Expenses % Revenue Jan-Mar 2008 Jan-Mar 2007 (RM ‘000) 2008 2007 Revenue 535,321 406,225 − Staff Cost (45,312) (38,609) (8.5%) (9.5%) − Fuel and Oil (270,576) (162,308) (50.5%) (40.0%) − User & Station Charges (33,143) (28,054) (6.2%) (6.9%) − Maintenance

  13. Slide 13: Driving Growth from Ancillary Income

    Driving Growth from Ancillary Income Jan-Mar Jan-Mar ∆% 2008 2007 Ancillary Income (RM million) 40.9 25.9 58% Passenger Spend (RM / pax) 15.7 12.0 31% % Revenue 7.6% 6.5% 1.1 ppt ‰ Driving promotions harder – increase penetration rate – packaged products to increase yields ‰ Checked baggage fee laun

  14. Slide 14: Managing Fuel

    Managing Fuel ‰ Fuel Hedge up to June – expected savings of USD10 million in second quarter – unhedged thereafter ‰ Looking for opportunities to hedge oil – short term hedges – crude component and refining margin – to reduce the impact of volatile spikes of fuel price 14

  15. Slide 15: The Best Fuel Consumption Rate

    The Best Fuel Consumption Rate Fuel Consumption (liters per 100 ASK) 3.54 3.52 3.31 ‰ Airbus A320 aircraft – furnished with lightest equipments (3%) 2.89 – operate from non congested 2.80 airports ‰ Initiatives to drive down fuel consumption even further Jun-05 Jun-06 Jun-07 Dec-07 Mar-08 15

  16. Slide 16: Borrowings and Gearing

    Borrowings and Gearing Net Debt (RM million) Net Gearing (Net Debt / Equity) 3,640 3,272 1.61 1.56 1,959 1.18 Jun-07 Dec-08 M ar-08 Jun-07 Dec-07 M ar-08 16

  17. Slide 17: Updates on Associates

    Updates on Associates

  18. Slide 18: Updates on Thailand

    Updates on Thailand ‰ Quarter updates – 32% passenger growth YoY on the back of capacity growth of 34% – 78% load factor with average fares of THB 1,750 – EBITDAR profit of THB150 million with 7.0% EBITDAR margins – posted a loss of THB123 million (RM12.8 million), our portion of losses is THB60 mil

  19. Slide 19: Updates on Indonesia

    Updates on Indonesia ‰ Quarter updates – 41% passenger growth YoY on the back of capacity growth of 51% – 75% load factor with average fares of IDR 410,323 – posted a loss of IDR64.5 billion (RM22.5 million), our portion of losses is THB31.6 million (RM11.0 million) ‰ Business environment has improv

  20. Slide 20: Summary

    Summary ‰ Challenging outlook but AirAsia will be profitable – innovation is key to survival – focus on low fares and marketing ‰ Ancillary Income – new products provide huge upside ‰ Most comprehensive route network in Asia – competitors are slowing, we are continuing to expand the network ‰ Strong

  21. Slide 21: Appendix

    Appendix Airline Of The Year

  22. Slide 22: Financial Data

    Financial Data Quarter Ended: 31 March Jan-Mar 2008 Jan-Mar 2007 ∆ (%) RM'000 Ticket Sales 494,382 370,257 34% Ancillary Income 40,939 25,924 58% Revenue 535,321 396,180 35% EBITDAR 130,745 127,004 3% EBIT 73,404 72,834 1% Pretax profit 110,174 43,072 156% Net Income 161,277 86,873 86% EBITDAR Margi

  23. Slide 23: Operating Data

    Operating Data Quarter Ended: 31 March Jan-Mar 2008 Jan-Mar 2007 ∆ (%) Passengers Carried 2,611,556 2,160,360 21% ASK (million) 4,364 3,215 36% RPK (million) 2,970 2,461 21% Seat Load Factor 72.1% 76.5% (4.4) ppt Average Fare (RM) 189 171 10% Rev / ASK (sen) 12.27 12.64 -3% Rev / ASK (US cents) 3.82

  24. Slide 24: Operating Data

    Operating Data Quarter Ended: 31 March Jan-Mar 2008 Jan-Mar 2007 ∆ (%) Average fare (RM) 189.3 171.4 10% Ancillary Income / pax (RM) 15.7 12.0 31% Unit Revenue / pax (RM) 205.0 183.4 12% Fuel consumed ( barrels) 768,665 606,395 27% Unit fuel price ($/barrel) 109.7 76.5 43% Average stage length (km)

  25. Slide 25: Fleet Composition

    Fleet Composition Aircraft count Dec 2008 Mar 2008 Now (May) (including spares) (tentative) Malaysia 43 44 40 Thailand 18 17 18 Indonesia 11 12 14 Group Total 72 73 72 Fleet Composition Airbus A320 39 42 55 Boeing 737-300 33 31 17 25

  26. Slide 26: Base Network as of May 2008

    Base Network as of May 2008 Bangkok 22 Routes 4 17 Kota Kinabalu 12 Routes 4 5 Kuala Lumpur 43 Routes 4 36 Johor Bahru 12 Routes 4 3 6 bases Jakarta 2 102 routes 16 Routes 4 11 Bali 4 73 aircraft 4 Routes 41 26

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