Blog: 2017 is a bad year for AirAsia due to higher fuel price & low RM? let check!

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3 comment(s). Last comment by cruger12345 2016-12-21 08:25

coolinvestor

1,251 posts

Posted by coolinvestor > 2016-12-20 21:17 | Report Abuse

good one bro. thx for the info!

ronnietan

141 posts

Posted by ronnietan > 2016-12-21 00:29 | Report Abuse

What about its RM10 bil of USD loans? Non-cash item? What about when it pays interest and repays loans, would it still be non-cash then?

cruger12345

696 posts

Posted by cruger12345 > 2016-12-21 08:25 | Report Abuse

Ronnietan. AA is paying the loan with its cash flow. The rm 10 bil is a long term loan. Probaly 20-25 years I am not sure but the lifespan of an aircraft is typically 25 years . It is just like you bought a machine with loan to do business. As long as the machine produces cash flow to pay off the loan and with good profit it shall not be a problem. If you are paying interest of 4% but your net margin is 10% it shall not be a problem. Of course airline is a much complicated business. This is just a example.

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