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Air Asia unit expects record revenue

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Air Asia unit expects record revenue

Budget airline Philippines Air Asia hopes to breach a new revenue record this year on expectations that people will fly more and avail themselves of add-on services such as onboard meals and extra luggage space.

Philippines Air Asia is targeting revenue to hit P13 billion in 2017, up by about 20 percent from the P10.8 billion it booked in 2016, airline CEO Dexter Comendador said. Revenue growth last year was 21 percent.

Comendador, a veteran Air Force and commercial pilot who who has held the CEO post for almost a year, said the airline’s growth was being driven by passenger and ancillary revenues.

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“This will be the best year in our existence,” Comendador said. Philippines Air Asia started in 2012 and it has grown organically and via acquisitions.

It completed in 2015 an investment in and merger with Zest Airways, a move that gave it access to valuable slots in Manila’s Ninoy Aquino International Airport, the Philippines’ busiest air gateway.

Comendador said profitability would also improve in 2017, as the carrier controls costs here and abroad via the group’s “One AirAsia” strategy, which involves the consolidation of its Malaysian, Philippines, Indonesian and Thai units under a single holding company that will also be publicly traded.

Comendador said Philippines Air Asia would still push for its initial public offering, earlier estimated at about $200 million, this year, with its potential listing by the fourth quarter of 2017.

“Tony’s instruction is to push for it,” Comendador said, referring to Air Asia Group CEO Tony Fernandes.

The Air Asia Group closed 2016 with 174 Airbus A320s, its annual report showed. Comendador said Philippines Air Asia would end 2017 with 19 A320s, up from 16 planes, to support its growth. Philippines Air Asia carried 1.04 million passengers last year, up 19 percent.

Comendador said the domestic fleet would grow to 70 planes in 15 years, or by 2032.

He said the plan was also to increase its presence in Clark International Airport in Pampanga, which was where the carrier first started operations.

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After temporarily suspending its Clark service in 2013 to focus on Manila, Philippines Air Asia resumed flights to Kalibo on March 27, 2017.

The Duterte administration had signaled its intention to pursue the development of Clark, an alternative air gateway to Naia, which is suffering from growing air congestion. Part of the government’s commitment was to build a new train system linking Clark to Manila before Mr. Duterte’s term ends in 2022.

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TAGS: Air Asia, Business, Philippines Air Asia
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