AirAsia Berhad : Philippines optimistic of improved 2022 performance, shares forecast on local aviation

The past year came with its own set of challenges - from new COVID-19 variants to stricter travel restrictions. However, it wasn't a year without some major wins. AirAsia has shown resilience throughout the year through strategic mitigation strategies that included new revenue streams, budget management and diversification of offerings.

With the downtrend in commercial flights in the first half of the year, AirAsia was quick to identify new revenue streams which include chartered flights for passengers and cargo. In 2021, for instance, AirAsia safely mounted 619 chartered repatriation and sweeper flights and reunited 50,000 people with their families and loved ones. This has helped defray upkeep costs to ensure the viability of the company.

AirAsia has also observed that domestic travel is gaining stronger momentum in the recent year end quarter, mostly because of the low positive infection rate and daily case count. In the first half of the year, the majority of airline bookings were done within 0 to 3 days, mainly for essential travel. But recently, the airline has witnessed a significant increase in bookings for travel 1 to 3 months in advance - a telltale sign of growth in leisure travel and stronger consumer confidence. AirAsia Philippines has also also recorded a 15 to 20 percent increase in bookings for near-term travel within 30-60 days over recent times.

AirAsia has also resumed its flight operations to Hong Kong, Singapore and Kuala Lumpur, Malaysia, servicing Overseas Filipino Workers and business travelers in these countries.

Accelerated Digitalization Amid the Pandemic

AirAsia Philippines has digitized multiple customer touchpoints and integrated several services in its airasia Super App. On the app, guests can now book their hotels and flights together in great value bundles through its SNAP feature. They can also do digital check-in at least 24 hours before their flight. And soon, boarding will be more seamless through the Philippines' first facial recognition system FACES, which is set to be implemented in the first quarter of 2022 for employees and second quarter for guests.

The world's best low-cost airline has also broadened its digital payment channels - forging stronger partnerships with mobile wallet giants GCash and Paymaya. The fast-growing reliance of Filipinos on mobile wallets has been observed by AirAsia Philippines which has grown its e-wallet transactions to 13 percent of total business, quadrupling its 2019 number of three percent.

The airasia Group's digital business has been recently valued at over USD 1 billion within two years, making it achieve digital Unicorn Status in record time, as reported by Credit Suisse. While the pandemic wreaked havoc on the aviation industry, non-airline verticals were fast tracked in airasia which has transformed into one of the top three ASEAN tech unicorns.

A Look into 2022: AirAsia Seeing a Better Normal