AirAsia Group Berhad Corporate Presentation August 2019 Strictly private and confidential 1
LEGAL DISCLAIMER Information contained in our presentation is intended solely for your personal reference and is strictly confidential. Such information is subject to change without notice, its accuracy is not guaranteed and it may not contain all material information concerning the Company. Neither we nor our advisors make any representation regarding, and assumes no responsibility or liability for, the accuracy or completeness of, or any errors or omissions in, any information contained herein. In addition, the information contains projections and forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. These views are based on current assumptions which are subject to various risks and which may change over time. No assurance can be given that future events will occur, that projections will be achieved, or that the Company’s assumptions are correct. Actual results may difger materially from those projected. This presentation is strictly not to be distributed without the explicit consent of Company’s management under any circumstances. Strictly private and confidential 2
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms Strictly private and confidential 3
The largest LCC in Asia The fourth largest airline in Asia 6 airlines 2 airlines 271 aircrafts, in 8 airlines 100 million passengers flown annually > 500 million total passengers flown 155 destinations across 22 Countries Over 393 routes, including 115 unique routes 24 hubs Over 10,000 flights per week *Fleet size and data as at July 2019 Strictly private and confidential 4
Wide digital reach via AirAsia.com, mobile app and social media Over 12,000,000 fans Over 26,700,000 followers Over 8,000,000 followers Over 560 million Over 40 million Over 1,700,000 followers annual unique (web&app) visitors mobile app download Over 2,000,000 followers Over 15 million Hits from over 240 Over contactable members different countries 1,300,000 followers 2.9% 60% Over 51 million annual conversion rate Sales via web and app total fans and followers *Data as at June 2019 Strictly private and confidential 5
Ancillary revenue growth from data & digital initiatives 2008 2018 9x RM2.06bn 1Q19 RM0.23bn 9% of revenue 21% of revenue 23% of revenue (up 29% YoY) ✔ Baggage ✔ Baggage (dynamic pricing) ✔ Inflight F&B ✔ Inflight F&B ✔ Pick-a-seat ✔ Pick-a-seat (+ hot seats) 78% 22% ✔ Wifi ✔ Insurance Airline Non-airline ✔ Ourshop ✔ Fly-Thru ✔ Cargo Strictly private and confidential 6
1Q19 Key Highlights Building digital platforms Strengthening our core Digitalising the airline Positive >87% New website and Search RM5.8bil Engine Optimized Pages: EBITDA +US$7.8mil Incremental revenue Load factor for all AOCs AirAsia.com Gross except for AirAsia Japan at Transaction Value 80% Conversion from flight For all Asean AOCs +66% (GTV) select on website +9% +29% +34% Conversion from flight 2.3x select on mobile Airline revenue, with Ancillary revenue RASK up 3% despite Teleport revenue (airline & non-airline) +10% adding 11% more ASK RM101mn, in line with RM400mn FY target Increase in flight search after Profitable +4ppt launch of website flight Improvement in Malaysia +48% After three consecutive search enhancement in Feb domestic market share, as quarters of losses 2019 seeing fruits from adding BigPay GTV 12% capacity in FY2018 +12% +23% QoQ growth +54% Profit growth by AirAsia Increase in flight search on Narrowing of losses by Philippines 25mil AirAsia Indonesia as RASK mobile up 10% and CASK down 21st 11% AirAsia BIG Members Oncoming aircraft to be Lombok (+9% QoQ) received in May 2019 Hub launched in May 2019 Travel Doc Scanner available on app in Feb 2019 Strictly private and confidential 7
Dividends ● 2019: special RM0.90 payable in 29 Aug 2019; 34% dividend yield ● 2018: Interim + special dividend – totaling to RM0.64 for FY2018; 21.5% dividend yield Special Dividends from Monetising Our Digital/Support Assets Aircraft leasing Pilot & crew training centre Hotel & travel Ground Handling Service •Sale of 79 aircraft and 14 •Monetisation of 50% •Sold 25% stake for •Cash proceeds received in stake: Cash proceeds of USD86 million in 2015 engines concluded for Jan 2018 SGD119.3 million USD1.085 billion in 4Q2018 USD100 million received in •Sold remainder of 25% Mid-Nov 2017 for USD60 million in Aug •Another 25 aircraft to transact 2018 for USD768mil Strictly private and confidential 8
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms Strictly private and confidential 9
Fleet Plan Fleet Expansion Across AOCs in 2019 MAA TAA IAA PAA AAI AAJ Total December 2018* 95 62 24 22 19 2 224 2019 Net Addition 2 -1 2 3 11 1 18 New A321neo aircraft are more fuel efficient & have * December 2018 fleet excludes 2 third party leases lower cost per seat Target aircraft financing for 2019: All on sale and leaseback. Our long-term fl fleet plan +28 +30 ↷ +30 ↷ +30 ↷ +30 ↷ 6 countries: +37 ↷ +38 ↷ +32 ↷ +36 ↷ +18 ↷ ↷ Exploring others: Note: Column chart includes 2 third party leases Fleet plan is subject to changes 2 10 Updated fleet plan as at 27 May 2019 Strictly private and confidential
Growing Market Share AirAsia’s Domestic Market Share & Rational Competition (1Q2019 vs 1Q2018) 4ppts 61% 32% 18% 6% 2% 1ppt 1ppt flat flat 3 ppts FLAT 2 ppts FLAT 4 ppts 1 ppt 1 ppt 1 ppt 6 ppts 1 ppt Source : PaxIS Strictly private and confidential 11
AirAsia Philippines AirAsia Indonesia EBITDA PAT EBITDA PAT 233% 12% 176% PHP million IDR billion 54% Indonesia reported higher EBITDA of IDR181bil Philippines EBITDA grew significantly by 233% to +176% YoY and significant narrowing losses after PHP1,538mil and profit after tax reported 12% tax of +54% as: growth due to: ○ Revenue grew 60% YoY ○ Outstanding revenue growth of 27% YoY ○ Demand hike LF +7ppts ○ +4ppts growth in LF at the back of 17% ○ Improved yield RASK +10% additional capacity ○ Well managed CASK -11% ○ 3% improvement in RASK ○ Better cost control CASK -2% Strictly private and confidential 12
Agenda Data-driven organisation Achieving the unthinkable Strengthening our underlying airline business DATA USERS COE Digitalising the airline AirAsia 3.0 DATA GOVERNANCE Leveraging our data to create platforms Strictly private and confidential 13
We have a lot of Data to drive ecosystem expansion BIG Data and Real-time Insights Engine & Component Contact Details FOMAX Transactions Online Activity Demographic Maintenance Feedback Loyalty Mobile Activity Aircraft Social Data Guests Speed Transactions Lifestyle Data Cabin Baggage Weight Feedback Queue Time Passengers Weight Apron Passengers Movement Temperature Location Terminal Counter Available data source Aerobridge Transactions Movement Potential new data source Strictly private and confidential 14
Data taking us to new heights Priorities Cost Reduction Revenue Gain to Focus On Verticals Pricing / Promos / Operations Fuel Cost Ancillary to Work On Bundling Rewards Efficiency Increase Increase Cost Drive Increase Drive More Goals Fuel Cost Efficiency & Customer Uptake Traffic to Achieve Efficiency Productivity Retention Skill Sets Data Science Required Strictly private and confidential 15
Staying true to being low-cost Our top priority, ALWAYS. Lower Predictive Driving fuel usage New A321neo aircraft airport maintenance to reduction through that are fuel efficient & charges increase data analytics have lower cost per efficiency seat Adoption of ‘Agile’ Media cost on a organisation downtrend with structure personalisation Strictly private and confidential 16
Agenda Achieving the unthinkable Strengthening our underlying airline business Digitalising the airline AirAsia 3.0 Leveraging our data to create platforms Strictly private and confidential 17
Growth in 2019 and beyond: AirAsia 3.0 Digital Bank & Logistics Insurance Lifestyle & Entertainment Marketplace Travel and fi financial platform of Asean Data AirAsia BIG Loyalty points - BIGLIFE AirAsia ecosystem comprises the Group’s core airline network operations, travel and lifestyle commerce platform, financial and insurance services, logistics services, as well as lifestyle & entertainment affjliates 18 Strictly private and confidential
We are investing in people Building blocks laid for a platform business Lye Kong Wei, Elias Vafiadis, Fabrice Marie, Group Head of Data Group Head of Software Engineering Group Head of Information Security (Formerly from Grab) (Formerly from Expedia) (Formerly from Lazada) AirAsia Software Engineering & Technology Center Bangalore, India 2 Strictly private and confidential 19
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