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The subsidiary of AirAsia Group, Indonesia AirAsia (IAA), narrowed its net loss during the first nine months of 2021. However, the low-cost arm of AirAsia Group, IAA, remains uncertain about the airline’s ability to “continue as a going concern”.
For the first nine months ending September 30, 2021, Indonesia AirAsia reported a net loss of 1.6 trillion Indonesian rupees ($111 million), a slightly improved financial result compared to 1.9 trillion Indonesian rupees ($132 million) loss during the same period in 2020.
During the nine-month period, Indonesia AirAsia operating revenues plunged to 487 billion Indonesian rupees ($34 million) against 1.4 trillion Indonesian rupees ($98 million) during the same period in 2020.
In addition, the airline’s consolidated current liabilities also exceeded its consolidated current assets by 6 trillion Indonesian rupees ($417 million) as of September 30, 2021.
To mitigate the adverse effects of the ongoing pandemic, the cash-strapped carrier has implemented several actions, including continuing its cost-cutting measures, such as payroll cost reduction, marketing expenses, reductions in events, and sponsorships.
The carrier also plans to negotiate with its creditors, critical vendors and aircraft lessors for its payment deferrals.
“Notwithstanding the above plans, there remain uncertainties regarding the Group’s ability to continue as going concern, which highly depends on the expected timing of recovery of the COVID-19 pandemic,” read the airline’s statement.