The revenue growth was supported by 10% increase in passenger volume, while the average fare was 8% higher at RM177 as compared to RM164 achieved in 2Q11.

The airline’s net operating profit, however, fell to RM130.94 million from RM135.17 million previously, due to a drop in ancillary income and lower seat load factor of 80%.

Operating profits also dropped to RM205.82 million for the quarter compared with RM214.8mil a year ago due to higher aircraft fuel expenses, staff costs and related expenses.

AirAsia’s newly appointed chief executive officer, Aireen Omar (pictured with Tony Fernandes on her right), said despite the majority of airlines losing money or severely behind in their earnings, AirAsia has continued to outperform each quarter by posting healthy profits.

“Our cash position also remains strong with RM2.16 billion in cash and bank balances and net gearing remained low at 1.10 times,” she said.

The company is now recognising profit from Thai AirAsia of RM11.9 million and Asian Aviation Centre of Excellence of RM2.2 million, Aireen added.

“This is yet another affirmation of what we have always maintained that our affiliates and adjacency business will contribute healthily to our bottom line while not including Indonesia AirAsia, Philippines AirAsia, AirAsia Japan and AirAsia Expedia, which are still posting losses. Eventually when they grow to a larger scale, the company can stand to benefit larger contribution to the bottom line.”

Thai AirAsia posted revenue of 4.43 billion baht, recording a growth of 16% year-on-year attributed to higher passenger volume from introducing new routes. Net profit was 245.79 million baht for the quarter compared to 328.08 million baht a year ago. Load factor for the quarter was 79%.

Cost per available seat per kilometre (CASK) was reported at 13.86 sen, an increase of 3% year-on-year and CASK,  excluding fuel, stood at 7.02 sen, an increase of 6%.

“Since the second quarter last year the company financed nine out of 14 aircraft through sale-and-leaseback and operating lease, thus increasing the aircraft operating lease expense by 147% year-on-year,” Aireen said.

Revenue per available seat kilometre was unchanged mainly due to the drop in the airline’s ancillary income per passenger spent from RM45 to RM37.

“This was due mainly to our experiment on our baggage pricing of which did not work. As the prices did not push demand higher as we envisioned, management then decided to reinstate the previous prices. Overall ticket demand also remained high despite an increase in average fare of 8% year-on-year and capacity increase of 12% year-on-year,” Aireen explained.

Looking forward, Aireen said AirAsia was on course for another good year in terms of performance.

“Based on forward bookings, demand remains positive as the Hari Raya Aidilfitri period will push for strong load factors in the third quarter 2012, and positioning itself for a seasonally-strong quarter,” she said.

AirAsia is expected to launch more new routes and increase frequencies on few routes within Asean in the second half of the year.

“This will be supported by the deliveries of 13 (as of date) new A320s to be distributed among the five entities. To cater for the high demand traffic throughout the region AirAsia has brought forward additional aircraft in 2013 and 2014 bringing the total number of aircraft to 21 and 24 respectively,” she said.

On fuel prices, Aireen said the airline was constantly monitoring the situation and aimed to match its hedges against forward bookings.

“We will not hesitate to add to its hedges if we perceive an opportunity,” she said.

On group updates, group CEO Tan Sri Tony Fernandes said AirAsia would maintain its focus on containing or driving down controllable costs to maintain the airline’s competitive edge.

“We will strive to increase load factors in line with the higher capacity. We are here to develop and grow markets in the region, which is very much a part of our Asean strategy. We will also continue to improve our product offerings to always provide the best customer experience to our guests.”

                                            2Q12 by the numbers