WITH no end thus far to heal its severe bleeding, long haul budget carrier AirAsia X Bhd is expected to continue facing severe liquidity constraints pending a debt restructuring initiative.
But until that happens, the airline will remain adversely impacted by suspension of its flights operations due to international air travel and border restrictions.
“No changes are made to our forecast for now as the group in still in the midst of its debt restructuring process and to raise new equity funding to provide sufficient capital to restart its operations when international borders reopen,” reiterated PublicInvest Research in its results review of AirAsia X (AAX).
“We retain our “underperform” call on AAX with target price of 1sen.”
AAX has reported a record quarterly core net loss of RM5.67 bil for the quarter ended March 31, 2021. The bigger net loss was dragged by operating expenses which amounted to RM5.21 bil mainly due to impairment of assets.
To re-cap, AAX has changed its financial year end from Dec 31, 2020 to June 30, 2021. For its 15M FY2021, core net loss for the airline widened to RM7.01 bil against RM1.42 bil for 12M FY2021, making up 354% and 360% of PublicInvest Research and consensus’ 18-month net loss estimates respectively.
During the quarter, AAX recorded minimal charter flights and freight services amounting to mere RM20 mil (4Q FY2020: RM7.4 mil) while the remaining was income from aircraft leases at RM18.2 mil.
At 11.35am, AAX was down 0.5 sen or 7.14 to 6.5 sen with 17.65 million shares traded, thus valuing the company at RM270 mil. – May 21, 2021
