AIRASIA POST 86% PROFIT

Report from CAN:

KUALA LUMPUR : AirAsia said on Thursday its net profits defied spiralling fuel prices to leap 86 percent in the first quarter, but that rising costs would impact on profit margins in the future.

Profits rose to 161.3 million ringgit (50 million dollars) in the three months to March, from 86.9 million ringgit in the same period a year ago, on revenue growth of 31.8 percent to 535 million ringgit.

AirAsia said that passenger numbers increased by 21 percent to 2.6 million during the first quarter, while average fares rose 10 percent, and that a looming consumer slowdown would not necessarily hurt its bottom line.

"Passengers who would normally take a full-service carrier are likely to trade down and fly with a low-cost carrier," Fernandes said.

"We believe the way around the spiking fuel cost is by reducing cost, and equally important is to consolidate our brand, using innovation and marketing to drive the top line."

AirAsia's Thai operations have improved considerably with five new Airbus A320 aircraft, and better passenger flow and load factors, it said. - AFP/de