Period 1Q12
Actual vs. Expectations
Slightly below ours
and the consensus estimates.
The 1Q12 core net
profit of RM163.6m made up 18% and 16% of ours and the consensus’ fullyear FY12 forecasts of RM896.4m and RM976.0m
respectively.
Dividends No dividend was declared during the quarter.
Key Result Highlights
QoQ, the core net
profit fell 42% on the back of a 8% drop in revenue. This was mainly due to a seasonally
slower quarter as compared to the peak period in 4Q11. Total cost increased by 11%
as staff cost increased by 22%.
YoY, the revenue grew
by 11% backed by higher ticket sales of 11% and also a fees surcharge imposed
during the quarter. However, the core net profit dropped by 12% as fuel and
staff costs increased by 17% and 27% respectively.
AirAsia has already
equity accounted for both Thai AirAsia (TAA) and Indonesia AirAsia (IAA) during
the quarter. It has also accounted for a loss of c. RM12m from TAA IPO expenses
and IAA operating loss.
Outlook 1Q12
is a seasonally slower quarter for AirAsia and we expect the earnings to pick
up in 2Q12 onwards due to the school holidays and positive contributions from
its associates.
TAA is scheduled to
list on the Thailand Stock Exchange on 31st May 2012 while IAA listing would be by
4Q12.
Change to Forecasts
There are no changes
to our FY12 and FY13 forecasts. We have factored in the contributions from TAA
in our FY12 forecast.
Rating OUTPEFORM
Maintain OUTPERFORM
given the potential capital upside of 20% from the current price.
Valuation We
are keeping our target price unchanged at RM4.06 based on 13.0x PER of FY12
earnings.
Risks A
spike in the average jet fuel price above USD130/barrel in FY12.
Source: Kenanga
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