KUALA LUMPUR -- AirAsia Group CEO Tony Fernandes said Thursday that a financial recovery is two years away as rising COVID-19 cases in major operating countries force prolonged border closures and travel restrictions.
Fernandes, the budget carrier's co-founder, spoke as the airline reported a revenue decline of 87% in the first quarter ended March 31 to 298.22 million ringgit ($72 million) from 2.31 billion ringgit posted in the same period last year.
AirAsia also recorded a net loss of 767.42 million ringgit, slightly better than the 803.85 million ringgit in red ink registered in the first quarter of 2020.
The group had racked up its worst ever annual earnings for the full year 2020 as a result of domestic and international border closures to contain the spread of the coronavirus pandemic, which has ravaged global travel and airline industries.
In a statement, Fernandes said the carrier is optimistic a recovery is achievable in two years given immunization efforts in major Southeast Asian economies, better testing capabilities, expected global digital health passports and more travel bubbles within the region.
"In most of our operating markets, inoculations are in progress and the majority will have had at least 50% of their population receiving at least one dose by the end of 2021," Fernandes said, adding that he recently received his first shot.
"This is expected to deliver a huge boost for air travel demand for our key ASEAN markets, on top of strong pent-up demand," he said, referring to the 10 countries that form the Association of Southeast Asian Nations.
Despite the pandemic-induced slowdown, the executive said AirAsia is eager to increase market share in Indonesia and the Philippines -- where it has stand-alone operations in both countries.
He also said that AirAsia has raised 336 million ringgit via private placement in the first quarter of 2021, with approval letters from banks that have been obtained for financing under a government program operated by Danajamin Nasional, Malaysia's sole financial guarantee insurer.
"Our aim is to raise 1 billion ringgit under the Danajamin scheme in Malaysia, as well as to raise new capital in Indonesia and the Philippines," he said.
In the same statement, AirAsia Group President (Airlines) Bo Lingam said the carrier experienced a recovery in travel in Indonesia during the first quarter, but demand continues to be weak in Thailand, Malaysia and the Philippines, which are all grappling with a fourth wave of coronavirus infections.
"AirAsia Indonesia is demonstrating strong signs of recovery as the entity operated close to 70% of pre-COVID domestic capacity in the first quarter of 2021," Bo said.
"We expect domestic operations in Malaysia and [the] Philippines will be below 25% of pre-COVID levels, until at least September 2021, while more of the population are receiving their vaccinations," he added.