Malaysia’s Capital A Berhad, owner of budget airline AirAsia, swung to an annual loss in 2024 due mainly to foreign exchange fluctuations, it reported on Friday, but said it expects to return to profit this year.
Capital A made an attributable loss of 475.1 million ringgit ($106.5 million) for 2024, from a profit of 255.3 million ringgit in the previous year.
The company said the loss was largely due to 1.4 billion ringgit in one-off forex losses mainly in its aviation business, which also caused the company’s fourth-quarter loss to swell to 1.57 billion ringgit from 345.3 million ringgit a year earlier.
Capital A was hard hit by pandemic travel restrictions and classified by Malaysia’s stock exchange as ‘PN17’, or financially distressed, in 2022. It is seeking to exit PN17 status.
Excluding the impact of the one-time charges, the aviation business benefited in the fourth quarter from an upsurge in domestic and international travel, although that was partly offset by higher marketing costs and user charges.
The aviation division expects 19 aircraft currently in storage to be active by the second quarter of the year, Capital A said in a statement.
Capital A is in the process of selling its AirAsia aviation business to long-haul unit AirAsia X Bhd, which counts Capital A as one of its top shareholders. The move was announced a year ago to consolidate long and short-haul operations under a single AirAsia brand.
The company said it expects to post earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations of between 500 million ringgit and 600 million ringgit this year.
That is a significant turnaround from an EBITDA loss from continuing operations of 663.2 million ringgit in fiscal 2024.
Capital A is expected to benefit from its aircrafts being fully operational, increased travel demand throughout most of the year and as the company focuses on more profitable air travel routes.
The company said approval for its regularisation plan submitted to Bursa Malaysia to address its financially distressed status is expected in the near term.
($1 = 4.4600 ringgit)
