Goodcompanies , that is an idea but with limited planes AAX cant kill the conpetitor. It is better at this point in time aax turn to increasing (optimizing) profit strategy. It worth it because even with lower load factor bur higher ticket price, aax would make bigger profit.

Actually, AAX can generate more revenue and profit if they stick to previous RM 526 average ticket per person. Let me show you why.

AAX load factor 80% for ticket priced at RM 455 with passengers = 1,387,257. So, we get revenue equivalent to RM 631 million.

AAX load factor 75% (using 2016 data) for ticket priced at RM 526, normalizing 75% load factor with Q22017 passengers, is 1,291,884 passengers. Revenue at that ticket price is RM 679 million.

Increased of revenue when ticket price is increased to RM 526 is RM 679mill - RM631mill = RM 49 million.

.............................

Because less passenger, we expect reduction of ancillary revenue.

With 1,387,257 passengers, ancillary revenue of AAX = RM 194 million.


With 1,291,884, ancillary revenue of AAX = RM 180 million.

So, decrease of ancillary revenue is RM 14 million.

..............................

Net increase in revenue = RM 49 million - RM 14 million = RM 35 million.


Total Revenue at ticket price assuming average ticket price RM 526, would be RM 1.036 + 0.035 = RM 1.071 billion.

That number is very close to my predicted revenue of RM 1.09 billion. See what I have written previously at this link below:

https://klse.i3investor.com/blogs/radziarticles/124835.jsp

................................

Net effect on total profit before tax (PBT) = RM 35 million + RM 28 million = RM 63 million.

That number is closed to my PBT RM 76 million at the link here :

https://klse.i3investor.com/blogs/radziarticles/125138.jsp

.......................................

What actually contribute to the difference between my prediction and actual result of Revenue and PBT ? It was average ticket price per passengers. Since this variable can not be intelligently guess very well in advance. (The value depends on the software that AAX used for pricing , the work of the software programmers and top management of AAX decision, it is beyond my predictability).

What I know for sure, AAX pricing has some mistakes. I have shown one bug here. The rest of the mistakes are confidential. That is the reason, I need Ben email address.

Despite their mistake, by environment circumstances AAX result is good, why not make it better by design ? :)))))))))))

So, NewInvestor17 .... I also like to meet those "IB" who you claimed had laughed at my prediction. I will give them some free lessons on forecasting and predicting analytics.

Of coursr it has to come with 100 million units of AAX share allocated to me at the beginning of the job.

Tonight i would calculate to check whether, it is more profitable if AAX had maintained the same average fare per passenger of RM 526. Preliminary result shows that additional RM 53 million additional revenue of basic ticket price is obtained if AAX maintain RM 526 average ticket price despite having 75% load factor ... LOL Ben.... you need a very good data analyzer to help you up. If there is a post of Chief Data Scientist in AAX , I will take it up for RM 1 pay per year.

P/E has stabilised to 15 , a good sign but they could not continue the trend of reducing average fare per seat because they need to pay back debt. We have a formula over here that would calculate sustainable growth. In long run, increasing market share would not be as important to sustainable growth.

Buy on weakness.

Average fare per passenger reduce from RM 526 to RM 455.

Revenue increases from 542,963,500 to 631,201,935. So, the increased of revenue = RM 88 million.

To fund this increase of revenue , they increase consumption of fuel. 253,780,423 to 349,553, 880. So, the increased of fuel cost is = RM 95 million.

So, reduction of fare increased revenue by RM 88 million but increased fuel cost by RM 95 million.

Net effect of reduction of average fare to that amount is reduction of 7 million ringgit of operating profit.

That type of average fare reduction is not sustainable right. The demand does not increased benefitingly with reduction of price with respect to increased of cost.

Two ways to overcome this is either to reduce cost or increase price per ticket. Since cost is rather fixed, you will need to increase price of ticket. AAX by now should have data that could simulate price elasticity. They need to study that first. Second, if competitive pricing, there is a system to be competitive by not being too underprice.

..................................................

You got Benyamin email, just give me his email and I will shoot him an email. We could work out a way for him to optimize AAX profit. Economics, customer analytics, software programming.

Anyone got Benyamin email address?

I just need to tell him that lowering revenue per passenger is not sustainable for AAX business in the long run and I want to give him a strategy that would make AAX a cash rich company.

enjoying the show

By Jan 2018, when new oil. price is hedged, fuel cost will reduce by another 40 million because if lower oil cost

And when exchange rate improve by 10% , operating profit improves by 60 million as fuel cost, lease cost and maintenance cost reduces

AAX can reduce 30% if stafff and increase operating profit by 30 million

I am not sure, Royce. I anticipate oil will move lower than 40/barrel before going less than 35/barrel but i have not simulated when the inflection point will occur.. Europe targeting 100% electric cars by 2030. So oil will soon be in sunset industry.

Frankly - I am very happy - the critics - Accesso, MrPouper, NewInvestor17, etc all shutted up. AAX supporter won , most important our win is accompanied with moral and spiritual win - we dont resort to swearing bad words. This is a very meaningful - morality and spiritual win.

xcuteboy : Many but still not enough.

Konbanwa (Good night) lspee .... I have revised down the model to RM 37 million profit before tax in one of my comments here after taking into account higher staff cost and fuel cost because the previous model uses historical data and 80% of historical data contains lower staff cost and fuel cost. It is lucky the revised model is near to result.

Some facts remain - as long as crude price going down, exchange rate improves, load factor 80% and above, other costs are managed, AAX would be good.

Several factors I am sure of -

(1) Morgan Stanley is in long position on ringgit.

(2) Crude price volatility increases when Saudi cut supply to USA but USA oil rigs number increases which means that any marginal increase of crude price would be retreated back towards USD 45. At this point in time, I still consider 45/barrel crude is the equilibrium price. Oil speculators are currently 50 : 50 ; long : short position.

(3) Libyan oil production stopped because ISIS took over the rigs. Soon, Saudi and USA will flood oil market because they dont want ISIS to sell oil at higher price and fund their terrorism activity.

Hopefully , PBT RM 100 million to RM 200 million materialised in Q3 2017.

Future growth of AAX is to make Japan a hub.

In 95% of the route, AAX is a supermarket but in 5% of the route - Hawaii , AAX is a BMW car market.

If I say my TP is 1.60 , you will say I am crazy. Long term holder is never crazy. Not tomorrow, not next week but long term.

Hahahahaha .... Royce Chan. You happy, I also happy. Everyone is happy. Let the price fly if it will.

i am hsppy .... dont want to promote yet because i am still buying LOL .... what more u want ? 47 million PAT is goood for seasonally weakest quarter.

looking ahead to Q3, EPS should be better !

Q3 lwould be better , Hawaii the game changer.

hahahahahaha ..... it is a good result for Q2... the weakest quarter

Mosiong Wong, if I have telephatic mind that can read what Benjamin is thinking then what I write below is accurate. But the truth is - I dont. So, i just go roughly through the figure.

My take at operating profit level, Q217 might be better than Q216 but less than Q12017.

At Profit Before Tax level, Q217 might be better than Q216 and Q117.

Tax - deferred tax and so on behave stochatically. So, I dare not speculate profit after tax level.

Anyway, if price goes down , I will still buy because my aim is Q3 and not Q2.

I am back Mosiong Wong after having yum cha with friends.... Nice cha.... so my brain is not functioning well. Let me just review back my analysis , and try to understand what you really need from me. I will post early in the morning tomorrow.

Some people hate me for writing analysis that supported AAX.... Other people hate me for not writing fast enough analysis that will help to answer their question.

Both type of people are giving me pressure because I know my limitation.

Chill bro. and sister. Let me have some life too ~ ok ?

Haii yaa Mosiong Wong, gua makan pun tak sensng....Jangan jerit jerit maaaa ... nanti gua reply laaa

Royce chan discussion is alright.... why do you guys complaint about his post ?

Royce ~ obvious those PONS have jumped in. It is one of their risk mitigation strategy.

Just 1 day news ... mehhhh ... Already old ?? Aiiyahhhh

Nekosaan - TheEdge News right from the oven.

Compeitive Market of Airport Operators Would Bring Value to Tourism Industry & The Country'

http://klse.i3investor.com/blogs/radziarticles/130555.jsp

Finally....hahahahaha... DNEX already jalan,... AAX takes longer time. Looking at sell queue, if shark push, 5 minutes, 5 price bid upwards go.

sometimes jokers can light up the day... but when you got a fella who only knows KNNCCB and CB to iritate you , then you feel your palm is big and strong enoungh to give a Pang in the face.

I tok nice nice nice , write articles , gives formula, wrote explanation , you call me KNNCCB CB and all sort of swear words. Wait, I buy scissors cut your tongue .... cut your fingers , you cant swore and write bad words, then i can write nice nice nice again and more..... Haiii yaaaa.... world live better without bad guys.

Good afternoon, GoodCompanies. Name calling are bully and harassment. Their ma and pa dont teach them when they are kid. I could only call a spade a spade by name calling back. But if I meet them in real life. I will cane their backside 100 times for not learning about manners from their pa and ma.

Later when AAX share moves up, NewInvestor17 will ask AAX shareholder to sell and invest in Ablegroup ....TP 25 ..., He say TP 25 sen prudent move mehhhhh... if Able goes down somemore he ewill keep quiet while quietly disposing his Ablegroup shares.... Already learn this trick from NewInvestor17.

QR out , bad or good , I am going to buy more.

NewInvestor17 : Weiiiiiiii CB , you think I dont get angry you use bad words on me..Let me give you back what you written KKNCCB 1000 times.... Tell your mother 100 times.... cry cry baby.

NewInvestor17 : You got tongue can curl your tongue upward downward forward backward. I buy scissors and cut your tongue so that it will not lie any more...

And dont act like I3 is your website and company macha..... I buy rotan sebat you backside 100 times.

I better keep quiet let NewInvestor17 talk kok so that price go down for me to buy bit by bit...... Haiyaaa... reverse psychology pun tidak faham ini budak.

Hahahaha Stupid NewInvestor17...... You want to talk in Invest KL 2017....go ahead, want to talk bad about AAX or AirAsia ... go ahead.... You expose yourself to Tony Fernandes and the gang, you think people wont hit you back ?? AirAsia got company in Thailand, Philipines, Indonesia, India.... you thinks TF Macai gangsta over there wont hit you back .. Got mouth talk....better got brain think.....

First , dont lie mehhh .... You lie to others , your share goes down 50%. You dont learn from your lesson ? Your mother and father dont teach you manners ?

Haiyaaa NewInvestor17 ....If you want to sell Ablegroup before the price reach TP 25 sen.... dont tell others that you will sell at 25 sen...

You think I dont know you promote the counters that you have interests in ? Haiiyaaa ..if you promote good counter I support, if you promote counter mati kiok macam itu Able ....gua kutuk gila-gila...... You think I cant think mehhhh .....

You lie to others, you think I dont know ... i3 your father own one ???

Smelly kaki NewInvestor17. You push AAX price down for me to collect bit bit some more...You talk kok I malas layan ... you dont know price go down I makan...

Talk kok NewInvestor17 ... got eyes dont see , got brain dont think, got heart dont say good thing...

http://klse.i3investor.com/blogs/radziarticles/125729.jsp

Click that link and see see see ....feel feel feel what you have written there TP 25 you will sell ? Got 2 IB support some more, still drop to 13 sen... Think think think .... why I brought up this issue ...

Mati wehhh investor Ablegroup.... You got promoter promote 25 sen.... Bila sudah mampus, dia cabut dulu.... Haiiyaaa Calvin Ong got more dignity than you . Panjat bukit terjun lombong la smelly punk.

See here NewInvestor17

From Kansai (Osaka) to Honolulu - RM 14 K for 2 person. Or RM 7k per person. Ini route manyak oonnggg !!!! Haiyaa ... smelly NewInvestor17 .. got eyes also can not see .

https://booking.airasia.com/Flight/Select?s=True&o1=KIX&d1=HNL&ADT=2&dd1=2017-09-23&dd2=2017-09-30&r=true&mon=true

NewInvestor17 : How is your Ablegroup ? Too shy to comment in that forum ? TP 25 sen cant get ? I see 2 Investment Bank try to project some financial analysis for Ablegroup to push the price to 16 sen. But most people listened to my article. They will not buy Able company one. Very disabled company liaowww nowadays always making losses.

So, have you sold your Ablegroup ? If you sold them, you are a liar because you said you will not sell it before it reach TP 25 sen. Not prudent to keep it low at 13 sen. It may go to 4 sen... A P17 candidate counter. 厄运 !!!

AAX has big potential. Unlike Ablegroup, you will be surprise at the look of Q3 result.

With flight to Hawaii from Osaka and KL generating RM 5k return ticket and above 80% occupancy rate. It is just unbelievable..Q3.....not so long, 3 months more to go. Quiet quiet buy little little when you say negative things...NewInvestor17 .... Aii yahhh you did me a favour you dont know aaa ?

Admin should remove those who swear bad words.

Major shareholders need to disclose any dealings. If they use proxy, then it is insider trading.

I wonder why Tony and Kama did not sell earlier if they know in advance that the profit is bad.

bb_in_de_houz 500% increase QoQ imeans RM 5 million profit after tax.

I dont have any estimate of US interest rates on AAX borrowing. Qualitatively, we expect one more hike of US interest rate in December or early 2018 and that will be it. We expect Janet Yellen will be replaced in March 2018. anext Fed chief will be friendly to Trump growth policy. Permian basin will continue push US oil production upwards with number of rigs continuously increasing. Oil will stabilise between 40 to 45 USD per barrel in 2018.

Result put on 24/8 . U can check at airasiax website.