AirAsia X: Loss in Income Statement Mainly Due to Impairment of Assets | Money
KUALA LUMPUR, May 20 – AirAsia X Bhd (AAX) clarified that the loss in its income statement is mainly attributable to the impairment of assets, which is carried out in accordance with accounting standards issued by the Malaysian Accounting Standards Board.
In a statement released today, the low-cost long-haul carrier said the relevant adjustments were needed in the context of the current operating environment and the ongoing restructuring process.
“According to the applicable standards, the assets are deemed to be impaired but the liabilities associated with these assets are currently contractually payable and therefore remain on the balance sheet.
“This asset impairment has no impact on the restructuring process the company is currently undertaking and appropriate accounting entries will be made on a successful restructuring which will more appropriately reflect the assets and liabilities based on the conditions of final restructuring agreed, “he said.
The airline said AAX and its restructuring advisers, New York-based Seabury Capital, had started active discussions with lessors and other creditors within two months of the court’s convening court ruling ( TLC) with a target result in the coming weeks.
As announced on May 7, 2021, the AAX would hold an Extraordinary General Meeting (EGM) on June 1 for shareholders to vote on the program.
“The CCM will be held in the third quarter for creditors to vote the same on the restructuring plan,” he said.
He said AAX remains committed to resuming business operations as soon as possible after the successful restructuring plan and the opening of international borders.
Meanwhile, in a case filed with Bursa Malaysia, the airline said there would be no comparative financial information available for the corresponding periods of the previous year due to the change in its end of year. fiscal year on June 30, 2021 from December 31, 2020.
He said that for the quarter ended March 31, 2021, the airline recorded a net loss of RM 5.67 billion while revenue stood at RM 38.49 million.
Looking ahead, he said AAX has sought payment deferrals and concessions from its suppliers, donors and lenders and is reducing capital spending where possible to maintain liquidity in these difficult times.
He said pay cuts have been implemented at all levels of the company except for the most junior staff, and the headcount has been cut by 10% with further cuts planned, mostly in functions related to flight operations.
AAX said it has also restructured much of its fuel hedges and is still in the process of restructuring the remaining exposure.
“We have applied for bank loans to improve liquidity and have entered into bilateral negotiations with our aircraft lessors and maintenance partners to significantly reduce the company’s operating cost base. This process is ongoing, ”he said.
He said that under the current circumstances, the airline will continue to seek additional liquidity and work on a significant reduction in the company’s cost base to allow AAX to continue operating in the post-Covid environment. 19 when aggregate demand for international air travel is expected to be significantly below the level of 2019 and prior years. – Bernama