{"id":514,"date":"2020-07-09T05:29:59","date_gmt":"2020-07-09T05:29:59","guid":{"rendered":"http:\/\/holidaysabah.com\/?p=514"},"modified":"2020-07-09T05:30:01","modified_gmt":"2020-07-09T05:30:01","slug":"unqualified-audit-report-with-emphasis-of-matter-clarification-latest-business-updates","status":"publish","type":"post","link":"https:\/\/holidaysabah.com\/?p=514","title":{"rendered":"Unqualified Audit Report with Emphasis of Matter clarification & Latest Business Updates"},"content":{"rendered":"\n

SEPANG, 9 July 2020 <\/strong>– AirAsia Group Berhad (\u201cAirAsia\u201d or the \u201cCompany\u201d) wishes to draw attention to our latest update where AirAsia\u2019s external auditors, Messrs Ernst & Young PLT issued an unqualified audit opinion with an emphasis of matter on material uncertainty relating to going concern in respect of the Company\u2019s audited financial statements for the financial year ended 31 December 2019. <\/p>\n\n\n\n

The unqualified audit opinion states that the financial statements of AirAsia for the financial year ended 31 December 2019 are true and fair and in compliance with financial reporting standards and statutory requirements, in all material aspects. <\/p>\n\n\n\n

The emphasis of matter highlights that there are significant uncertainties with respect to the Company\u2019s ability to continue as a going concern as a result of the unprecedented Covid-19 pandemic. <\/p>\n\n\n\n

Nevertheless, it is important to note that the financial statements have been prepared on a going concern basis, as the Board of Directors is confident of the successful continuation of the business, in conjunction with the actions undertaken by the governments of the operating entities, outcome of ongoing discussions with financial institutions and investors to obtain required funding and implementation of management\u2019s action plans, in response to the conditions above.\u00a0<\/p>\n\n\n\n

In this regard, the auditors\u2019 report should be read in full and can be found in the annual audited accounts<\/a> that is available on the Company\u2019s Investor Relations website<\/a>. <\/p>\n\n\n\n

Domestic rebound demand is strong; Optimistic of re-opening of international travel<\/strong><\/p>\n\n\n\n

AirAsia Group Berhad CEO, Tan Sri Tony Fernandes said \u201c<\/strong>The first half of 2020 has been extremely challenging. However, in recent weeks, countries around the world have resumed domestic travel and are gradually reopening international borders in recognition that air transport provides the connectivity that is essential for the resumption of economic activities. <\/p>\n\n\n\n

The formation and discussion of \u201ctravel bubbles\u201d and \u201cgreen lanes\u201d\u00a0 with key economic partners with a low infection rate and proven pandemic curbing systems, is a step in the right direction.\u00a0\u00a0<\/p>\n\n\n\n

\u201cAs domestic travel is now allowed in Malaysia, Thailand, Indonesia, India and the Philippines, we have been resuming our flights on a staggered yet steady basis since late May. <\/p>\n\n\n\n

In support of governments\u2019 efforts to revive domestic tourism and ultimately stimulate economic recovery, AirAsia has aggressively launched large-scale promotions and sales campaigns. I am encouraged by the higher-than-anticipated sales this has generated.\u00a0 <\/p>\n\n\n\n

On 7 July, we registered our highest post-hibernation sale with 75,000 seats sold in a single day, reflecting pent-up demand and signalling green shoots of recovery. We also sold over 200,000 AirAsia Unlimited Passes since its recent launch for domestic Malaysia, domestic Thailand and AirAsia X.\u00a0<\/p>\n\n\n\n

\u201cPositive trends in our flight bookings and load factors are additional signals of a better second half of the year. In June, our group-wide load factor was 60% with AirAsia Malaysia\u2019s load factor reaching 65%. For July, we expect to achieve a higher load factor of 70% despite tripling our capacity month-on-month to cater to the increased demand. <\/p>\n\n\n\n

\u201cTeleport, the profitable technology-meets-logistics venture of AirAsia, accelerated its regional growth despite a challenging environment, growing 49% year-on-year in the first quarter of 2020. <\/p>\n\n\n\n

This growth was supported by a strong emphasis on transporting medical aid and critical supplies at a time of need. In addition, despite the complete hibernation of the airline group, Teleport pivoted from delivering cross-border e-commerce to last mile deliveries, delivering more parcels, restaurant orders, and fresh produce during the movement control period than in the previous 12 months collectively. <\/p>\n\n\n\n

With the launch of Freightchain, the world’s first digital cargo platform built on blockchain, the re-launch of OURSHOP as an e-commerce marketplace to support the local businesses we love, and rollout of OURFOOD a fuss-free platform to bring all types of food businesses online, Teleport has emerged with even stronger growth prospects for the second half of 2020.<\/p>\n\n\n\n

\u201cAs a great believer in Asean, we remain confident in the growth potential of the region. In IMF\u2019s latest World Economic Outlook, Asean-5\u2019s GDP growth is expected to rebound strongly to 6.2% in 2021, one of the highest growth rates in the world. <\/p>\n\n\n\n

We\u2019re confident that AirAsia will not only benefit from this growth upturn but also contribute to the region\u2019s recovery given the significant role that air connectivity plays in Asean\u2019s trade and investment landscape.\u201d<\/p>\n\n\n\n

On funding…<\/strong><\/p>\n\n\n\n

\u201cWe understand the importance of shoring up our liquidity to ensure sufficient cash flow. We have been presented with proposals in various forms of capital raising, be it debt or equity, and are in ongoing discussions with numerous parties, including investment banks, lenders, as well as interested investors in seeking a favourable outcome for the group. <\/p>\n\n\n\n

We have received indications from certain financial institutions to support our request for funding, amounting to more than RM1.0 billion. Of this debt funding, a certain portion would be eligible for the government guarantee loan under the Danajamin PRIHATIN Guarantee Scheme in Malaysia. <\/p>\n\n\n\n

Other than Malaysia, our Philippine and Indonesia entities are currently in various stages of bank loan applications. In the Philippines, we have applied for the government guaranteed loan under the Philippine Economic Stimulus Act (PESA), with an expected positive outcome.\u201d\u00a0<\/p>\n\n\n\n

On working capital management,…<\/strong><\/p>\n\n\n\n

\u201cDuring the hibernation period, we have taken significant measures internally as a group while also reaching out externally for assistance to ensure our working capital remains intact. <\/p>\n\n\n\n

\u201cInternally, we have embarked on headcount rationalisation for leaner operations, given the current demand for air travel and expectations on recovery. Internal cost-cutting efforts include a group-wide temporary salary reduction of between 15% – 75%. <\/p>\n\n\n\n

\u201cWe have received deferrals from our supportive lessors and are now working on further extensions. We have also restructured 70% of our fuel hedging contracts and are continuously negotiating with our supportive counterparties for the remaining exposure. <\/p>\n\n\n\n

\u201cAll in all, we expect at least 50% reduction in our cash expenses in 2020.<\/p>\n\n\n\n

\u201cIn conclusion, the impact of Covid-19 pandemic on the Company is never taken lightly, as does the trust and support put into us. The management has been working tirelessly to ensure the sustainability of our business operations.<\/p>\n\n\n\n

With the confidence of our stakeholders and business partners, we are determined to move forward in this new normal. We are positive that the proactive mitigating actions we have implemented as well as our consistency in transforming the Company would aid us in recovering and overcoming this operating environment.<\/p>\n\n\n\n

\u201cIn times of difficulties lies opportunities.\u00a0 We have weathered many crisis and emerged stronger. We won\u2019t waste this crisis and we will come out stronger.\u201d
<\/p>\n","protected":false},"excerpt":{"rendered":"

SEPANG, 9 July 2020 – AirAsia Group Berhad (\u201cAirAsia\u201d or the \u201cCompany\u201d) wishes to draw attention to our latest update where AirAsia\u2019s external auditors, Messrs Ernst & Young PLT issued an unqualified audit opinion with an emphasis of matter on material uncertainty relating to going concern in respect of the Company\u2019s audited financial statements for…<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[31],"tags":[],"class_list":["post-514","post","type-post","status-publish","format-standard","hentry","category-airlines"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/posts\/514","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=514"}],"version-history":[{"count":1,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/posts\/514\/revisions"}],"predecessor-version":[{"id":515,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=\/wp\/v2\/posts\/514\/revisions\/515"}],"wp:attachment":[{"href":"https:\/\/holidaysabah.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=514"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=514"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/holidaysabah.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=514"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}