Thursday, February 08, 2007

AirAsia has funds for expansion

KUALA LUMPUR: AirAsia Bhd has sufficient funds for fleet expansion and does not have to raise any more capital up to 2009, according to group chief executive officer Datuk Tony Fernandes.

“We have no immediate plans to raise funds by selling new stocks to shareholders.

“Our business has never been stronger than it is now. We are happy that our cash flow and capital structure is really good,” he said after a signing ceremony between LogicaCMG and Tune Money Sdn Bhd yesterday.

Fernandes dismissed concerns raised by analysts on the need for the company to raise capital to fund its latest order of additional 50 A320 Airbus.

“We are very comfortable with our gearing level and positive cash flow, coupled with good load factor, we do not need to go with the rights issue, secondary or primary market (to raise fund).

“We probably won't need (additional) funds up to 2009,” Fernandes said.

He had no doubt that the airline would be able to fill its planes, as there were 500 million people in the southeast Asian region and the potential was huge.

He added that the additional aircraft would bring in the load factor and business for the airline.

Fernandes had also expressed confidence over AirAsia's growth, saying that the airline expected to carry about 62 million passengers by 2013.

He said AirAsia would continue to grow with new routes and more frequencies.

Fernandes added that AirAsia's board would probably meet on Feb 28 to discuss a proposal to buy 20% of rural carrier Fly Asian Xpress, which runs AirAsia X, a long-haul budget carrier.

Source : STAR
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