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AirAsia to set up new budget carrier in Vietnam, posts higher 2007 profit

AirAsia to set up new budget carrier in Vietnam, posts higher 2007 profit

Malaysian low-cost carrier AirAsia unveiled plans to set up a new airline in Vietnam as part of its expansion, after earlier reporting a sharp rise in net profit for its 2007 fiscal year.
AirAsia will team up with Vietnam state-owned corporation Shipbuilding Industry Group, or Vinashin, to establish its third affiliate carrier in the region, said its chief executive Tony Fernandes. It already has affiliate carriers in Thailand and Indonesia.
AirAsia, which is Southeast Asia's largest budget carrier by fleet size, will own 30 percent and Vinashin 70 percent in the venture, Fernandes said.
The new airline, which will be named Vina AirAsia, is expected to build a fleet of 9 aircraft over the next two years, Fernandes said. AirAsia plans to set up two more affiliate carriers in the region "in due course," he said, without giving further details.
Vinashin is the largest shipbuilding company in Vietnam and is expanding its operations into other areas, such as financial investment and transportation service, officials said.
AirAsia earlier reported a 41.5-percent rise in net profit from last year for the quarter through June to 185.1 million Malaysian ringgit (US$52.9 million; euro38.8 million), as revenue surged 79 percent to 432.2 million ringgit (US$123 million; euro90 million).
Its net profit for the full year ended June 30 rose to 498.1 million ringgit (US$142 million; euro104 million), more than double profit of 201.7 million ringgit (US$57.6 million; euro42 million) a year earlier.
AirAsia attributed the increase in fourth-quarter revenue and earnings to a 45 percent rise in passenger volume from the previous year as average fares fell by 7.6 percent. It said it also made gains from the disposal of interest rate swaps.
AirAsia said it took delivery of 21 new A320-200 aircraft during the 2007 fiscal year. It said it expects to carry 11 million passengers in the year ending June 2008, up from 8.7 million in 2007 fiscal year, due to more flight frequency and new routes. This will boost growth in pretax profit in 2008, it said.
"We will grow from strength to strength. We feel confident about our outlook," Fernandes said.


Updated : 2021-03-01 05:05 GMT+08:00