Capital A Berhad · MYX:CAPITALA
Capital A Berhad — AirAsia Berhad — Q3 2012 Earnings Presentation
25 slides from Capital A Berhad's earnings presentation, 2012
Slide 1: AirAsia Berhad Third Quarter 2012 Analyst Presentation
~ AirAsia Berhad Third Quarter 2012 Analyst Presentation
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
Slide 3: 3Q12 Key Financial Highlights
3Q12 Key Financial Highlights
Slide 4: 3Q12 Results - Key Highlights
3Q12 Results - Key Highlights ALL THREE OPERATIONS POST REVENUES, OPERATING PROFIT AND NET PROFIT GROWTH Q Revenue = Malaysia - RM 1.23 billion up 14% y-o-y = Thailand - THB 4.43 billion up 17% y-o-y = Indonesia - IDR 1,200.40 billion up 9% y-o-y Q == Operating profit = Malaysia - RM 281.18 million
Slide 5: YTD12 Results - Key Highlights
YTD12 Results - Key Highlights Q Revenue =» Malaysia - RM 3.59 billion up 12% y-o-y * Thailand - THB 13.78 billion up 17% y-o-y = Indonesia - IDR 3,098.26 billion up 12% y-o-y Operating profit » Malaysia -RM 727.08 million up 3% y-o-y " Thailand - THB 1.10 billion down 20% y-o-y = Indonesia - IDR 23
Slide 6: 3Q12 - Financial Results - Malaysia
3Q12 - Financial Results - Malaysia QO) Load factor 77% despite capacity up 10% QO) RASK up 5% due to increase in average fare and ancillary income QO) CASK up 6% y-o-y whilst CASK ex fuel up 8% y-o-y " Maintenance- increase of aircraft in for routine maintenance and checks " User Charges - Last yea
Slide 7: 3Q12 - Financial Results - Thailand
3Q12 - Financial Results - Thailand Q Q Revenue up 17% y-o-y in line with passenger growth of 22% y-o-y Load factor of 82% up 2ppt YoY RASK up 4% YoY CASK up 4% y-o-y mainly due to:- *" Maintenance up due to more C’check and engine refurbishment " User Charges - One off charges for move to Don Muean
Slide 8: 3Q12 - Financial Results - Indonesia
3Q12 - Financial Results - Indonesia QO) Revenue up 12% y-o-y due to increase in fare and higher passenger growth QO) Operating profit improves posting 715% increase due to discipline cost control QO) RASK up 13% due to increase in average fare and ancillary income QO) CASK up 1% mainly due to:- *"
Slide 9: Looking Ahead: Strategy and Issues
Looking Ahead: Strategy and Issues
Slide 10: Strategy
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Slide 11: Strategy: Maintain Cost Leadership
Strategy 1. Maintain Cost Leadership Further improvement of cost reduction: QO) Future growth at lowest cost QO Sharklets on Aircraft = Fuel Savings of approximately 3% QO) A320neo = Fuel Savings of approximately 16% (Engine & Sharklets) QO) Pushing for LCC Terminal =" TAA - moved to Don Mueang on 1
Slide 12: Strategy: Leveraging the AirAsia Brand - Malaysia, Thailand
Strategy 2. Leveraging on the strong AirAsia brand to Build Market Share MALAYSIA Adding 10 aircraft in 2013 Total new capacity in 2013 will be 89% of frequency addition and 1% growth of new routes To grow load factors to approximately 85% To continue to grow domestic market, Indonesia, and China TH
Slide 13: Strategy: Leveraging the AirAsia Brand - Indonesia
Strategy 2. Leveraging on the strong AirAsia brand to Build Market Share INDONESIA =" Adding 9 aircraft in 2013 = Total new capacity in 2013 will be 50% of frequency addition and 50% growth of new routes = Re-focus on domestic market and growing organically =" Aggressively grow distribution channel
Slide 14: Share price performance vs airline peers
-5.0% 0.0% 5.0% -10.0% -15.0% 10.0% 15.0% 20.0% AirAsia 17.4% Ryanair 15.0% Cebu Air 7.75% Air China 5.55% Thai Airways 3.40% Singapore Airlines 2.34% Garuda 0.71% Korean Airlines 0.43% Cathay Pacific -0.75% Easyjet -6.76% MAS -6.84% Tiger Airways -11.35% 14
Slide 15: Strategy: Defending our position - Huge Market
Strategy 4. Defending our position a) Huge Market UNITED STATES Southwest main LCC in United States a * Total Fleet/Total population is : 311.59 million \) amma 0.0002% EUROPE Ryanair & Easyjet main LCC in Europe populati * Total Fleet of 492 opulation * Total Fleet/Total population is : 298 194 492
Slide 16: Strategy: Defending our position - Strong Balance Sheet
Strategy 4. Defending our position b) Strong Balance Sheet =" Net Gearing of 1.03 times =" Cash position of RM2.2 billion = In position to provide dividend; dividend policy being explored = Free Cash Flow of RM557.51 million to date 16
Slide 17: Average Fare, Load Factor, RASK
200 177 176 180 168 160 140 120 100 80 60 75 78 80 40 20 0 2009 2010 2011 Average Fare (RM) Load factor (%) RASK 17
Slide 18: Strategy: Ancillary Income & Adjacency Business
Strategy 4. Defending our position d) Ancillary Income & Adjacency Business - Defense against competition Ancillary income = Medium term target of 23-25% of revenue = To target RMSO per pax in 1-2 years = Introduce Wifi and recamping Duty Free business Adjacency Business - AirAsia Expedia * Profit o
Slide 19: Strategy: AirAsia X Connectivity and Market Share
Strategy 4. Defending our position e) AirAsia X - Connectivity = Adding 7 aircraft in 2013 = To rely on massive medium haul feeder traffic = Key core markets is Australia, China, Korea, Taiwan & Japan f) Grown market share against competitors « AirAsia had 2 aircraft in 2001 whilst another local car
Slide 20: Dealing with Competition
Dealing with Competition * Minimal impact * Europe was a mature market with Open Skies whereby airlines could fly anywhere * Asean is partly open skies (between capital cities only) * Every route approvals is still subject to Government and regulators * Asia still lacks secondary Airport * Lack of i
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Slide 22: Appendix: CASK breakdown
Appendix CASK breakdown 22
Slide 23: 3Q12 - CASK - Malaysia
3Q12 - CASK - Malaysia Cost / ASK (US cents) 3Q12 Staff Costs (0.63) (0.62) Depreciation (0.66) (0.71) Aircraft Fuel Expense (2.15) (2.09) Aircraft Operating lease expense (0.18) (0.10) Maintenance, Overhaul (0.18) (0.08) User Charges and other related expense (0.50) (0.50) Travel and tour operation
Slide 24: 3Q12 - CASK - Thailand
3Q12 - CASK - Thailand Cost / ASK (US cents) 3Q12 Staff Costs (0.55) (0.52) Depreciation (0.02) (0.02) Aircraft Fuel Expense (2.28) (2.25) Aircraft Operating lease expense (0.99) (0.98) Maintenance, Overhaul (0.44) (0.39) User Charges and other related expense (0.78) (0.78) Travel and tour operation
Slide 25: 3Q12 - CASK - Indonesia
3Q12 - CASK - Indonesia Staff Costs (0.50) (0.47) Depreciation (0.10) (0.02) Aircraft Fuel Expense (2.50) (2.32) Aircraft Operating lease expense (0.64) (0.72) Maintenance, Overhaul (0.29) (0.35) User Charges and other related expense (0.55) (0.47) Travel and tour operations expenses 0.00 0.00 Other