Southeast Asia carriers earn more in Q1

MANILA, Philippines – Southeast Asian airlines saw continued growth in their earnings in the first quarter amid improved market conditions and lower fuel prices.

Based on a report by the Center for Asia Pacific Aviation (CAPA),  the combined operating profit of 20 publicly traded airlines reached $688 million, up 51 percent from the $456 million earned in January-March quarter.

During the period, 13 carriers were profitable and were able to further hike its operating income.

Budget carrier Cebu Pacific posted an almost 40 percent hike to $89 million while AirAsia Philippines narrowed its loss to $7 million from $15 million a year ago.

Flag carrier Philippine Airlines, on the other hand, saw its profit decline by 18 percent to $61 million.

Thai Airways, Malaysia AirAsia, Singapore Airlines, Bangkok Airways, Thai AirAsia, Malaysia AirAsia X, SilkAir, Garuda Indonesia, and Thai AirAsia X also improved their first quarter results.

TigerAir Singapore and Scoot swung to profitability while Indonesia AirAsia, Indonesia AirAsia X, NokScoot, SIA Cargo, Citilink and Nok Air trimmed their losses.

“Profitability in Southeast Asia has been steadily improving since the beginning of 2015. However, profitability in Southeast Asia remains at a much lower level than in most other regions due to intense competition and overcapacity in some markets,” CAPA said.

“While the improvements are encouraging and provide for a brighter outlook, Southeast Asian airlines continue to underperform compared with their peers in other regions,” it added.

CAPA said despite improving market conditions and lower fuel prices, overcapacity remains an issue in some markets and competition continues to be intense, putting pressure on yields.