AirAsia X slides to first-half loss after boosting capacity

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AirAsia X has blamed capacity expansion in 2013's second half for a MYR169 million ($53.3 million) operating loss it suffered in the six months ended 30 June.

The low-cost long-haul carrier had made a MYR46 million profit in the same period last year.

Revenue rose 39% to MYR1.42 billion in 2014's first half, but operating expenses soared 62% to MYR1.59 billion. The Kuala Lumpur-based airline added 53% to capacity, but revenue per available seat-kilometre fell 10%.

New routes to cities including Chongqing, Nagoya and Xian plus boosted frequencies to Sydney and Melbourne allowed AirAsia X to triple its market share on "core markets" between Australia and North Asia, but chief executive Azran Osman-Rani admits that the capacity expansion "put short-term pressure on earnings performance".

However, he adds: "The long-term strategic advantages are very compelling. We now have our strongest route network, with multiple cities in each of our markets, and strong frequencies that lead to convenient transfer connections."

Ancillary revenues grew 48% in the first half, to MYR291 million, and the carrier netted MYR25.3 million by leasing two Airbus A330-300s to affiliate Thai AirAsia X.