KUALA LUMPUR • AirAsia Group posted its largest quarterly loss on record as restrictions imposed by governments to contain the spread of the coronavirus pandemic decimated travel.
South-east Asia's second-biggest budget carrier by market value reported a net loss of RM992.9 million (S$325.4 million) in the three months ended June 30, versus net income of RM17.3 million a year ago, according to an exchange filing on Tuesday. Sales plunged 96 per cent to RM119 million.
Chief executive Tony Fernandes has been in talks for joint ventures and collaborations that may result in additional investment for the beleaguered airline. Bank loans and other capital-raising proposals are also being weighed.
"During the lockdown, we took the opportunity to restructure the group and lay the foundations for a sustainable and viable business for the future," Mr Fernandes said in a statement on Tuesday.
"Although we do not foresee capacity returning to pre-Covid-19 levels in the short term, we expect demand to gradually continue to grow throughout the second half of 2020 and for the airline to be profitable in the years to come."
Airlines globally have grounded thousands of planes as countries shut borders and restrict people's movements.
Some signs of a recovery are at least emerging for regional aviation, with Singapore and Malaysia agreeing to form travel bubbles to allow people to move between the two countries.
AirAsia, which is based in Malaysia, resumed flights in the domestic market in late April after suspending them for a month.
AirAsia said in an earlier statement on Tuesday that it had "applied for bank loans in our operating countries to shore up our liquidity".
AirAsia's auditor Ernst & Young said last month that the carrier's ability to continue as a going concern may be in significant doubt because its current liabilities exceeded its current assets at the end of last year, even before the pandemic.
It also sounded a warning on AirAsia X, the airline's long-haul arm.
The company's business operations have seen positive developments "as passenger seat booking trends, flight frequencies and load factors are gradually improving to cater for the increasing demand", AirAsia said on Tuesday.
As at June 30, AirAsia had RM996.1 million in cash compared with RM2.59 billion a year ago.
Some 42 per cent of the airline's revenue in the second quarter came from cargo and logistics.
South Korea's SK Group said in June that it was in talks to buy a small stake in AirAsia, without providing further details.
AirAsia has also cut the salaries of management and deferred plane deliveries in an attempt to shave costs by 30 per cent this year.
BLOOMBERG
