Tue, October 26, 2021

international

AirAsia gets RM500mil lift


KUALA LUMPUR: AirAsia Group Bhd (AAGB) has received the approval from Danajamin Nasional Bhd for an 80% guaranteed loan of up to RM500mil, which will help put the low-cost carrier in a firmer position to boost its operations.

In a statement yesterday, AAGB said the loan was under the Danajamin Prihatin guarantee scheme, which is part of Malaysia’s economic stimulus package following the unprecedented outbreak of Covid-19.

“The loan has been approved by AAGB’s lenders under a club deal term financing (Club Facility), with the aforementioned guarantee to be provided for the Club Facility by Danajamin via Syarikat Jaminan Pembiayaan Perniagaan, a wholly-owned entity of the Finance Ministry,” it said.

AAGB said the loan is a strong signal of support for the group, as it gears up to ensure it is in a robust position to once again serve the nation and the communities it operates to.

AAGB also said the loan will allow it to play a key role in rebuilding the economy as the country emerges from the Covid-19 pandemic.“The financing under the Club Facility is earmarked for working capital purposes which will support staff costs and key operating expenses such as aircraft maintenance, as AAGB prepares to ramp up its operations leading up to the re-opening of interstate and international borders in the near future.”

In the same statement, AAGB executive chairman Datuk Kamarudin Meranun said the low-cost carrier has been a major contributor to the Malaysian economy by providing connectivity to facilitate tourism, trade and investment activities.

“We have also been pivotal in generating a significant number of job opportunities and empowering local small and medium-sized enterprises, especially through our digital ventures.

“This approval from the Malaysian government is a strong endorsement of AirAsia Group’s ability to recover fast and provides a welcome boost to our overall fundraising strategy as we prepare to return to the skies in all of our key markets.”

Kamarudin noted that countries around the world, including those in the region, have begun to reopen international borders amid promising progress in vaccination rates.

“Malaysia’s adult vaccination rate is close to 90% and domestic interstate movements will be allowed once we reach that milestone.”

Kamarudin added that the Langkawi travel bubble has been a huge success, with overwhelming demand since AAGB launched up to 90 services a week from Sept 16.

“In Thailand, Indonesia and the Philippines, we are seeing pleasing progress as services have gradually started to resume.

“As countries in the region continue to discuss and implement travel bubbles and to gradually reopen international borders, we are confident that we will be able to recover and rebound strongly in the near future.”

AAGB’s net loss in its second quarter ended June 30, 2021 narrowed by almost 42% to RM580.06mil year-on-year, mainly due to increased revenue from a low base as well as reduced operating expenses.

Revenue more than doubled year-on-year to RM370.61mil from RM142.09mil in the second quarter of the previous financial year.

Cumulatively, for the first six-months period ended June 30, 2021, AAGB reported a net loss of RM1.35bil. Revenue fell 72.4% year-on-year to RM686.82mil from RM2.49bil.

Published : October 06, 2021

By : The Star