Friday June 13, 2008 MYT 11:54:09 AM
Nomad Investment accumulates AirAsia shares

KUALA LUMPUR: AirAsia Bhd, whose share price had come under some selling pressure recently, saw Nomad Investment Partnership LP accumulating 10 million shares of the low-cost carrier.

A filing with Bursa Malaysia showed the Cayman Islands-registered fund buying 8.23 million shares on June 10 and another 1.77 million shares the next day.

The recent acquisitions saw the fund’s shareholding increased to 5.58% or 130 million shares.

Meanwhile. T. Rowe Price Associates, Inc. sold 3.2 million shares in the open market on June 6, cutting its stake to 157 million shares or 6.61%.

According to a filing, the shares are owned by various individuals and institutional investors where T. Rowe Price is an investment adviser with the power to direct investments and/or power to vote on the securities.

AirAsia’s share price fell to an all-time low of 82 sen on June 10.

Volume is still high today, pushing it all the way up to 1.09.

And then a whole bunch of sellers appeared, pushing it back down.

Don buy stock according to tips from magazine most of them are very misleading i think. If you follow the tips from the edge most of the time you will make a loss.

that time everyone also think Transmile is a good company mah, profit growing every year but later only found out ....   

Liong Sik must explain Transmile fraud
Jun 2, 07 5:22pm
Former cabinet minister Dr Ling Liong Sik should explain the Transmile accounting fraud, involving overstating profits up to RM530 million, said Opposition Leader Lim Kit Siang.

Ling, formerly MCA president, is chairperson of Transmile Corporation, a global aviation group, that has come under fire for overstating its profits.

A recent special audit carried out by Moores Rowland Risk Management Sdn. Bhd, showed that Transmile made pre-tax losses of RM126 million and RM77 million for 2006 and 2005, respectively, instead of pre-tax profits of RM207 million and RM120 million as originally reported – a total of RM530 million in overstatement.

“Liong Sik should explain how he is going to assume responsibility for the Enron-type ... fraud in Transmile,” said Kit Siang in a statement today.

Pos Malaysia & Services Holdings Bhd has warned that its earnings for the financial year ended Dec 31 may be affected by the reported overstatement of Transmile's sales revenue as the postal group owns 15.3% of Transmile.

“I am surprised that Pos Malaysia & Services Holdings Bhd has not admitted that its earnings for the financial year 2005 could also be affected,” said Lim.

Pos Malaysia reported a net profit of RM160.2 million for 2006 and RM145.3million for 2005.

Lim said that as a former senior cabinet minister – Liong was transport minister – Malaysians expect Liong Sik to be “a model of a responsible corporate player.”

He said Liong Sik should be “more forthcoming” and “make a clean breast” of his responsibilities and remunerations including waht he had drawn from Transmile in his capacity as chairperson.

Raise in Parliament

“Dr Ling Liong Sik was quite active in the past month ... [he was at] Universiti Tunku Abdul Rahman (Utar) campus in Kampar yesterday planting a Blue Pine tree,” said Lim.

“But he has been very reticent on what has been described as the biggest accounting and corporate scandal in recent times in Malaysia, even likened to the accounting fiasco of Enron and Worldcom,” he said.

He added that DAP will be raising the Transmile fraud in June’s parliamentary session.

Transmile closed 32% lower at RM6 yesterday from its RM8.90 pre-suspension level last Monday, causing massive losses to small-time investors.

Shocked by the outcome, Khazanah Nasional Bhd has ordered an inquiry into Transmile.

Khazanah unit’s Pos Malaysia, is the second largest investor in Transmile after Malaysia’s richest man, Robert Kuok.

AirAsia Q2 net profit plummets
By Jeeva Arulampalam Published: 2008/08/29

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A forex loss of RM76.9 million and record high jet fuel prices hurt the budget airline, leading to a 95 per cent drop in net profit to RM9.4 million


LOW-COST carrier AirAsia Bhd said second quarter net profit plunged 95 per cent to RM9.4 million due to foreign exchange losses and high fuel costs.

It had a forex loss of RM76.9 million because a weaker ringgit increased the amount of its foreign debt.

It expects a challenging third quarter, traditionally AirAsia's weakest. Last month, it had to contend with record high jet fuel prices.

Revenue grew 41 per cent to RM608 million in the three-month period ended June 30 2008, attributed to higher passenger volume as well as ancillary income.



It carried 20 per cent more passengers, or 2.8 million people, while ancillary income jumped 60 per cent to RM50.3 million.

Ancillary income refers to sales of food, beverage and travel insurance, among other things.

"The per passenger ancillary spend has increased 34 per cent to RM17.80 and ancillary income now represents 8.3 per cent of total revenue," group chief executive director Datuk Seri Tony Fernandes said in a statement released yesterday in Kuala Lumpur.

It filled 76 per cent of its planes, down from 81 per cent previously, as it added new planes and new routes had yet to do well.

Fernandes said that AirAsia had some short-term hedging, but its fuel requirements were largely not hedged.

"We will do a vanilla hedge if required, but hedging is expensive right now, so we'd rather not," he said in a conference call with analysts yesterday.

AirAsia's associate companies in Thailand and Indonesia posted losses.

"The Thai operation endured a challenging period due to escalating domestic political uncertainties," he said.

However, Fernandes said he was optimistic over the long term as other airlines had ceased operations or cut back on capacity in Thailand.

"We can invest in the business and rejuvenate the fleet with new Airbus A320 aircraft and expand our route network," he said.

The Indonesian operation was affected by the costlier fuel due to its usage of the Boeing 737-300 aircraft.

"Indonesia will receive its first Airbus A320 on September 19 and this will reduce operational cost and enhance efficiency," Fernandes added.

In the half-year period, net profit declined 37 per cent to RM170.7 million from RM272.3 milion previously.

Revenue, however, was up 38 per cent to RM1.1 billion as passenger growth increased 20 per cent.

AIRASIA, the region's biggest budget carrier, is making a risky bet.

As soaring fuel prices have forced other airlines to cut back, shed jobs and ground planes, AirAsia is doing the opposite: increasing flights, adding routes and boosting capital investment.

Last month, it even gave away a million free seats (although passengers still had to pay taxes and fuel surcharges). The seven-year-old company is aiming to fill the vacuum as other airlines reduce capacity, betting that more travellers will opt for budget flights amid a global economic downturn.

Analysts say if it survives the industry slump, AirAsia could come out a winner with increased customer loyalty and a strong route network to catch the growth wave when good times return.



"They are reasonably well-positioned for the long run, but there's always a trade-off. It's a long-term decision, which will cause some short-term pain," said Damien Horth, Asia transport analyst at UBS AG in Hong Kong.

Of course, the strategy could also backfire badly.

Last month, AirAsia reported a 95 per cent plunge in its net profit for April-June quarter to RM9.42 million. But the company chalked that up mostly to a RM77 million foreign exchange loss from a weakened ringgit, not weakness in its underlying business.

Average load factor - the percentage of seats taken up in an airplane - dipped to a still relatively strong 76 per cent, from 80 per cent in 2007.

It has a cash reserve of about RM1 billion, but outstanding debts stand at RM5.4 billion, giving it a net debt position of RM4.4 billion. Debts are set to grow as it receives new planes.

Chris Eng, analyst with OSK Securities in Malaysia, said AirAsia's growth prospects may be curbed, while its joint ventures in Thailand and Indonesia are expected to remain in the red.

"It will be challenging but we believe AirAsia can survive," Eng said, citing its efficient regional network and good cost control. - AP