AirAsia X Berhad (AAX) Q4 FY2025 Earnings Call Transcript & Summary

Hi, everyone. Welcome to [ AirAsia X ] Outlook and [Technical Difficulty] Fourth quarter and full year results. Just an important note on the presentation slide. In the brochure that's released today, it talks about AirAsia X performance for the fourth quarter as a stand-alone airline. In this presentation that we just released, we have included disclosure of the short-haul performance given that Capital A yesterday reported only for 11 months. So I do hope that please do not do comparison on that results. Moving forward, we will report AirAsia X as an enlarged AirAsia X Group, where we consolidate 6 AOCs and also Thai Asia X as an associate. With me in the room, we have Group CEO, Bo Lingam; Deputy Group CEO, Farouk Kamal; CFO, Kar Chuan; and Lavinia, the Head of Group Finance. I will pass the presentation to Kar Chuan. [Foreign Language]

Thank you. We did better in the first half when you were not hearing. Anyways, we will make a presentation as follows -- in the slides, which is different from the results announcement. For 2025, we'll be talking about AirAsia X Standalone, Asia short-haul as well as AirAsia Group, and we'll talk about our 2026 strategy and outlook for the whole group. Next. As you are well aware, it's a new era for the group on the aviation side. We just completed the transaction in January 2026, where all the 7 AOCs now sit under one entity, which is the AirAsia X entity. In due course, as you know, we will be doing rebranding subject to the all the necessary approvals to be obtained. We have a new leadership lineup already announced. We strengthened the Board composition with the addition of independent Nonexecutive Director. And with this going forward, we intend to continue what we've done well in the past, which is reap the synergies from this combined entity, continue to dominate ASEAN with the widest network, connecting into key Asia Pac regions as well as further strengthening our reach into new destinations such as the Bahrain and London destinations that we've highlighted and with strengthened operational scale with the 250 aircraft under our stable. So we'll talk a bit about performance for the short-haul business. It's been a stellar 4Q 2025, where we've achieved an EBITDA of MYR 1.2 billion, 24% margin with an NOP of MYR 500 million, which is a 10% margin, a significant turnaround from previous quarters. This performance was driven by a strong 5% increase in passenger traffic, 7 million packs and a major rebound in Thailand's performance. The Thai businesses released their results recently, which is also a significant turnaround in 4Q '25, which is positive for us with Thai AirAsia and Thai X recording their first quarter year-on-year revenue growth. Notably, TAA achieved significant turnaround profitability in 4Q '25, while the associate TAAX delivered its strongest revenue quarter of the year. AirAsia Cambodia also has achieved profitability, which is -- which we're happy about, proving the power of our brand and network connectivity. AirAsia Cambodia turned profitable in its first full year of operations since its launch 2024 with an NOP of 7.5% for 2025. For Philippines and Indonesia, we're also on track for recovery. We see positive signs in terms of EBITDA improvement. For Philippines, we also recently launched Cebu Hub, which we are working hard to connect into our existing network. And Indonesia also remains resilient, maintaining positive EBITDA momentum despite seasonal trends. AirAsia X Standalone also had a robust fare environment. Average fares rose 15% year-on-year, offsetting strategic 6% capacity realignment to focus on high-yield longer-haul routes. NOP of MYR 54 million, which is a 5.9% margin despite new route launches in the quarter, including Istanbul and Tashkent. Next. Unit cost discipline, CASK has gone down by 9% to USD 0.26, driven by favorable fuel prices, normalization of maintenance costs and ongoing fleet and network optimization. Ancillary also continues to contribute robustly about 19% of 2025 aviation revenue. Ancillary per pax marginally up to MYR 60 per pax. And baggage remains the key driver, contributing 61% of total ancillary revenue, and we will talk more about our ancillary strategy in the subsequent slides. From an enlarged AirAsiaX perspective, NOP after nonoperating aircraft and MYR 290 million, which is a 4.8% margin as well as the enlarged AAX has met profitability internal targets, including MYR 4.6 billion revenue, 21% margin and exceeded the NOP margin at 5.9%. Next, we've talked a bit about this already. For 4Q, we achieved MYR 5 billion revenue, 1.2 billion EBITDA and MYR 500 million NOP for the short-haul business, CASK has gone down by 4.5%. And from a full year perspective, we've achieved the numbers that you can see there, about MYR 19 billion of revenue, roughly flat, while our EBITDA and NOP has increased at MYR 4.15 billion and MYR 1.2 billion, respectively. There's been -- we've spoken a bit about this already various factors to this, including on the revenue side, there's been a Thailand rebound. And then on the cost side, there's been a lot of tailwinds, including from the fuel costs as well as other costs which we have normalized. Anything else to talk about? Okay. We'll go to AirAsia X Standalone for the 4Q, achieved MYR 921 million revenue and MYR 124 million EBITDA with a MYR 54 million NOP. This is probably -- this is going to be the last time that we will be releasing results for AirAsia X on a stand-alone basis. So I think going forward, we will talk more from a group perspective. Next, so this is the enlarged AirAsia X results. Again, we're very happy with the outcome, achieved about MYR 6 billion of revenue in 4Q with a 1.35 billion EBITDA together with MYR 554 million NOP. On an annualized perspective, we achieved a MYR 22 billion revenue with a MYR 4.5 billion EBITDA and NOP of MYR 1.3 billion. The EBITDA and NOP targets were met from an internal target perspective, and we were slightly off from a revenue perspective. So shareholders' equity is robust at 767 million. And going forward with improved performance going forward, we will continue to strengthen on the shareholders' equity. This just shows an illustrative amount of revenue and profitability loss because of the capacity that was not in full capacity in 2025. So this is just for illustrative purposes only. Had we had the full strength of our fleet in 2025, we would have achieved the numbers in black, which is MYR 24 billion revenue together with NOP of about MYR 1.45 billion. So this one was for illustrative purposes for your analysis. As highlighted, operating cost decreased 9% year-on-year on an enlarged aviation group basis is driven primarily by 3 factors, which is the lower fuel costs, lower other operating expenses as well as maintenance and overhaul costs. Other cost drivers, staff increased 4%, user charges down 7% and depreciation and amortization went up by 5%. Operating cost from an ex-fuel perspective was $0.06, down 7% year-on-year. And we feel that the cost environment is expected to remain contained, supported by favorable fuel trends, stronger ASEAN currencies and continued operational efficiencies that we will gain through the fleet reactivation progress as well as all the synergies and the centralization that we will undertake going forward as a single entity. Ancillary marginally up to MYR 4.3 billion. As highlighted, baggage is the main driver at 61%. Ancillary contribution remains healthy at 19% of overall AirAsia Group revenue. AirAsia, The baggage contributes about 2.6 billion of ancillary for the year. Seat revenue was also up 9%. Flight fuel increased up by 5%. On an ancillary per pax basis, it was marginally up by 0.2% at CC3. Going forward, in terms of our strategy, we intend to strengthen the MOVE contribution. And as you are aware, the MOVE contribution is on an ancillary per pax basis higher, 47% higher than other OTAs, suggesting higher upside for the group going forward. Okay. We will move to strategy and outlook for 2026, our strategy is going to be volume or load active. We intend to increase by 12% and increase the load factor above the 80% to 85% target that we have. There are various strategies being employed by the commercial team for this. We can talk about that if you have questions later on. And we will continue to dominate routes through high frequency, dominate the market share in the key regions that we have, as you know, Malaysia and Thailand, 60% and 40%, respectively. We also plan some new routes focusing on connecting existing destinations. So the focus continues to be from an ASEAN and Asia perspective, and we will have also selective routes connecting outside of that. We will continue maximizing ancillary yields and take-ups and we can talk about that also in subsequent slides. And one of the initiatives that is core to our DNA is cost reduction through various initiatives such as the refinancing that we're doing and a few other factors we'll talk about the next slide. So again, in addition, getting all our aircraft back into the sky remains #1 priority. As highlighted and illustrated earlier, about MYR 2.2 billion revenue loss, which we expect to gain back this year. We only have about 10 aircraft, 9 aircraft from storage undergoing checks at the moment, which we will target for completion on 6 in March and 3 in April 2026. And aircraft remains pending engine replacement, which we also aim to do in the near future. From a commercial and network strategy perspective, there's a lot of tailwinds in our favor. China's rebound, strong recovery expected in 2026 and Malaysia and Thailand is expected to ride this wave with new routes and added frequencies. The China-Japan situation also is a tailwind for the ASEAN region. From a currency perspective, the currencies continue to strengthen from a ringgit and Thai perspective, which is our 2 dominant countries. Regional Asia is expected to grow 5% in 2026 versus 3.3% global, underpinned by a lot of policy support. Visa-free travel will continue to happen within the region. And from a Malaysia perspective, visit Malaysia year 2026 is ahead of us this year, which we expect to have double-digit inbound arrival about 15%. From a core market leadership perspective, we continue to focus on strengthening and dominating on the domestic side from Malaysia and Thailand perspective. And from IAA, Indonesia perspective, we have -- we will continue to focus on international connectivity, which is our strong point. A lot of airports are going to reopen in that region, which will open up for international travel. That's also a positive for the AOC over there. And from a Philippines perspective, we will improve RASK by network rationalization as well as scale through the Cebu Hub given the constraints that we have in Manila. We will have strategic frequencies to dominate proven corridors with high-frequency flying. We have the Bahrain-London strategy that we are undergoing at the moment with strong positive initial bookings already. Our flight will start to fly in June 2026. And we do have also interline strategies that we have set up for our Istanbul and Turkey hubs, which goes down to the bottom where we aim to increase the flight crew expansion with a target 10% flight crew contribution in 2026. And I've already spoken about Bahrain and activity over there. Ancillary strategy I talked about from a #4 perspective, baggage enforcement is going to be a strategy, as highlighted earlier. Baggage contributes about 61% of ancillary. So we will strengthen baggage enforcement in the key hubs around our region. And in addition to that, we will continue to innovate new products to deliver more value, personalization through AI adoption, very interesting new developments over there, which we can talk about as well as increasing the move contribution to our sales. This one just talks a bit about fleet rollout. We expect the fleet to remain at about 253 combining short-haul and long haul. And going forward, in the coming years, you can see it growing up to 350 aircraft in 2030. We have about [ 23 ] deliveries expected this year, but we will replenish them through new deliveries and third-party leases that we have lined up. So for 2026, we expect to close at about 253. We have 4 new 321LRs, which we will deploy into the Malaysian AirAsia X. And there will be a few third-party leases also that we plan to sign up on. In addition, as you are well aware, we also have the 150 OEM order book, which we plan to close in the near term. These are the cost reduction initiatives I highlighted. So various initiatives, including reactivating all the aircraft by this quarter or by April. We want to replace all the old aircraft with more fuel-efficient aircraft with the 321s coming in as well as the regional aircraft that we plan to put an order in. And we are increasing predictive maintenance capabilities through AI adoption and through our ADE partnership. In terms of financial optimization, refinancing corporate loans remains key to us through bank financing and public debt issuance, we could drive 3% interest cost savings. We also expect to have -- we also are negotiating hard on lowering the de factor on the fuel cost. Fuel cost has already come down, but we want to bring it down further through the de facto savings. And as highlighted, we want to reduce OTA commissions by moving back to the ramp-up. In terms of strategic and regulatory, we renegotiate with all our partners, the OEM contracts, airport incentives, ground handling, and we also work hard with the ministries to increase better air traffic management. So there's a lot of interesting things happening within the group. And we're quite optimistic for the year. So this one talks about our internal targets for 2026 based on all the assumptions that you can see in front of you. We have a target revenue of about MYR 25 billion and EBITDA of MYR 5 billion and NOP margin of 5%. We -- obviously, it's a range just like we did last year, but we just wanted to give some form of anchor basically, right, some anchor point that you can -- we can guide you from our internal targets. That's it.

Thank you. Kar Chuan. I'll open it to questions. [Operator Instructions] You'll start -- this is from Kong the first Asia Aviation Group team. First and foremost, congratulations. Literally the world's best low-cost airline is now officially out of PN17. He has about 5 questions. status, may I confirm that Q1 is there only 1 aircraft still in storage? If so, would it be fair to use Q1 '26 as a more normalized base that better reflects the Aviation Group's underlying performance, assuming minimal disruption from grounded aircraft. At the end of Q1...

March, you will have 6 aircraft, so you have to discount the 2 months. Q2, I think, which is April, you have mostly all your aircraft...

Next question is on OEM compensation. Previously, you mentioned potential chargebacks due to engine delivery delays. Could you provide any updates on this?

Negotiations are still going on. We are very positive of getting compensation. Most probably in the next 1 month or 90 days, next 45 days, we should be able to conclude it.

And then when do you expect full fleet restoration?

Full fleet restoration, I think most -- only 1 aircraft in April. I'm just waiting for the engine to go through the test cells and so forth. Hopefully, by second week of April, we can get the last aircraft out.

I'll open up to the floor if there are any questions. Yes. Next question, still from Kong on the Bahrain initiative. With the launch of KL Bahrain London service and the broader Bahrain strategy as a global hub, could you provide more color on the expected cost implications for the group, both in terms of operating expense and capital investment?

At this point of time, we are just flying KL Bahrain Bahrain London. It's just utilizing the fifth freedom. It will be the same from Bangkok to Bahrain and into Europe. At this point of time, we are very focused on just utilizing the fifth freedom. So the hub is not in ...

Secondly, how do you expect this to impact the group's bottom line economically and financially? Are there specific cost assumptions or yield expectation we should be aware of as you scale the Bahrain operations?

I honestly don't think there's any more investment. I think it's only positive because we get good fares and so forth. So there's no downside to it.

Does the management have a time frame or milestone when you expect the Bahrain hub to contribute meaningfully to the profitability of.

No, it's not a hub. It's just a flight going on Fifth Freedom. There is no aircraft that's going to be based now at this point of time.

Yes. So to answer your question, is just a route using the Fifth Freedom rights.

Just like what we do out from Taipei to Suoka, it's the same concept.

Any questions from the call?

This is [ Ben ] here. I just want a quick check on your fuel hedging policy. I think one of the risk events on the horizon would be if there's any tensions in any flare, right, I think the Iran situation. Just wondering how you're thinking around this kind of risk event, whether there's any risk mitigation here? Because I think the fuel costs that you've been enjoying in '25, about 101, there's probably risk to that. Yes, please give us some color on your risk management strategy here.

Yes. So I think... Just like you know about all the geopolitics that happens, there's also the TAO element in there, right? So it's very hard for airlines and businesses at the moment to undertake any carefully planned hedging strategy, right? Just like something can happen, but something can also not happen, right? In the meantime, we feel that the levels here are still very good, not just from a fuel perspective, from an FX perspective. We feel that absent all this noise, fuel will continue to be down trending. So we do have a hedging strategy that we have in place, which we've highlighted in previous quarters also, but it's not going to be driven by all this geopolitical noise that's happening because just like something happens, something can also not happen.

All right. I understand. So you're currently not hedging for this event or this potential event?

No. Yes.

Okay. My second question is just on the fares. Just wondering what's the outlook on fare pricing so far this year? Should we expect to see your yields come down as you start to deploy capacity? Can you give us a sense of the direction here.

No, I don't think so. I think is going to be stable as what it is. I think we are a lot more on load. So I don't see any downside. We'll be able to hold...

Next question from Daniel from Hong Leong. Actually, first thing, I just want to clarify the you mentioned here, actually, what -- is it at EBIT level or is it at the PBT level.... Here excludes the nonoperating aircraft ForEx, shares of associates, et cetera. It follows our normal how we report in the P&L, the face of the P&L.

[Technical Difficulty].

Also included the full P&L for you in the appendix for the short-haul and enlarge in the appendix. So you can see which line we're referring to. I see.

Okay. I just want to check back to the slide on the short-haul.

Yes.

I think you managed to get a recent, to a actual NOP of MYR 1.3 billion…

In revenue? Enlarge is one…

MYR 22 billion, correct?

Yes.

[Foreign Language] -- you guys have a lot of a [indiscernible], so I just don't really understand your target for this year seems to be for this FY '26, you have a higher revenue target, yes, MYR 25 billion, but your NOP target seems to be even lower than last year?

That's just a point, right, Daniel. It's supposed to be a range. But it's just that this year, we're just anchoring the guidance towards a point. So if you will, right, you can think of it as a range within that point basically.

What's the original upside from this 1.25...

We can't guide more than that, right? So we're just guiding towards those anchor points.

Okay. From your anchor point, looking at your assumptions here, you are looking at all these percentage numbers ASK all this. So from this growth engine point, [Foreign Language] what are the things that we can see to provide for the upside from an I think the upside [indiscernible] anchor point. So for that we are looking at a official aircraft or why is the way the ASK or [Technical difficulty].

I think the upside as ancillary. There is also your cost. I think as the first day, we are actually [Technical Difficulty] from our OEM guys. Because now we have PN17. We agree negotiating all our contracts. So there's a lot of upside there in the next few quarters, you'll see all those savings coming in.

Yes. And in addition, obviously, this guidance is based on certain assumptions. But -- even now, we can see the -- for example, the USD MYR continues to strengthen against the assumptions that we've given. That's one tailwind. And it's predominantly going to be on the cost side, basically where we will surprise on the upside.

So we are looking at the cost side, the cost to be lower than what we are looking -- what you are looking at now.

Yes, if there is any tailwinds to the internal guidance.

I see. Okay. From all your operations, you have Malaysia operations, Thailand operations Philipp operations, Indonesia operations and operations -- for 2026, we will assume that Malaysia will be the strongest profit-making entity.

How about Thailand, Indonesia, Philippines and Cambodia, how should we look into this?

I think Thailand will be pretty good. As you know, for the Chinese New Year, Chinese New Thailand a lot of tourists. I don't see any downside to it until end of the year. Of course, you have something happening, then it's a different story. The same goes for Philippines, Indonesia. As you see, Cambodia, we are being very cautious. Once I get all my approvals for China and India, then I will add planes there. But apart from that, I think we are looking at all positive growth in all the countries. India and China.

So Philippines and to turn around, this year.

If you look at it earlier in the slide, we are pretty well recovering. It's just that we need aircraft there. Once the aircraft comes in and then as you're aware from the last Cebu Hub, it's a new hub and we are growing that hub. So with Manila being congested, so we are opening up a new hub Cebu and that Hub doing pretty okay. I mean just started. So hopefully, in the next 2 quarters then when we get all our aircraft, it will be in full swing.

So Philippines will stay in for the next 2 quarter, 3 quarters before it can recover in the fourth quarter…

Yes. [Technical Difficulty]

We EBITDA positive for both Indonesia and Philippines. Yes.

It will get better in the next 2 quarters.

We know that Malaysia and Thailand, we don't expect further restructuring needed for these two [Technical Difficulty] needed for the rest further injection this...

Yes, there is for Indonesia and Philippines, which we are working on now.

[Technical Difficulty].

Pardon.

How much are we looking at?

[Technical Difficulty] these special [Technical Difficulty]. We will restructure [Technical Difficulty] next level [Technical Difficulty].

[Technical Difficulty] this restructuring [Technical Difficulty].

[Technical Difficulty] last year... because our past experience hasn't been good. So, have very carefully select his partner.

So definitely is some we... I don't think we are in rush probably as…. We will make sure that [Technical Difficulty]. And in the fourth quarter, reason of fourth quarter [Technical Difficulty] for example, higher provisions for maintenance and [Technical Difficulty] so we are asking it now. Is there anything that [Technical Difficulty].

On the costing side nothing exceptional in terms of maintenance or higher [Technical Difficulty] or reversal of this…

[Technical Difficulty] we will show the slides, other than that there is no other action.

Only for the [Technical Difficulty] these aircraft are not operating for [Technical Difficulty].This amount [Technical Difficulty] realize that with [Technical Difficulty].

I am sorry, I didn't you. So in the fourth quarter compared for this month [Technical Difficulty] fourth quarter numbers compared to the previous 3 quarters first second quarter.

It's about the same...

[Technical Difficulty] about 3 in Indonesia and 2 in Philippines...

Three Indonesia, 2 Philippines.

And the rest four Indonesia.

Moshe to ask your questions.

Okay. Yes. Okay. Wonderful. I'm going to jump around between Slides 23, 24 and 15. So I know it's a very simple question, but very important to me. Slide 23 -- sorry, Slide 24, when you say pro forma operating statistics, I want to refer to the ASK of 1,13378 million. I just want to understand how you get that number. Is it 100% for the entire 7 airlines?

It is there for the 6 airlines.

So Thailand Aisa X is excluded from this one?

Yes, correct.

Okay. Wonderful. That clears things up. So when you say there's going to be a 12% ASK target on Slide 15, it's basically 12% from this 113 number.

At least 128 billion...

128 billion ASK. Okay, wonderful. And then load factor target of 85%, you won't give any guidance with regards to yields or unit revenue or anything of that sort for now?

No, but you can calculate by the revenue number that we've given of 25 billion.

Yes, I can work backwards from there.

RASK will be flattish.

Okay. So I can average flight length, so that will give a good idea. Okay. The other thing I need to ask is with regards to your maintenance, right? Because I'm taking the view that in the past, your maintenance intensity is -- it's a bit high because of the existing aircraft that you have, you have to run them hard. So they're probably doing more hours, more landings than historical normal. And due to that, your maintenance expenditure would probably be higher than historical normal. Now going to 2026, can we expect the maintenance per aircraft per year would be heading lower? Is this a fair assumption?

Yes, it's a fair assumption.

Okay. Roughly how much can I expect... Because I'm trying to compare relative to your 2019 norms, you are like 20% higher than 2019 norms in terms of...

Because at that time, the aircraft were all on in storage. All the reactivation costs... That's why I can't -- I just don't know how [Technical Difficulty]. Cost of spares all gone up. So that's why, as I said earlier, I'm going to go back now we are out of PN17, negotiate hard with all the OEMs...

If you saw Rolls-Royce release the results today, you'll be saying 4s. You deserve to demand for lower cost from all these OEMs. Anything making too much money.

Everyone is the same. Just have to look at Rolls-Royce results. We just released 2 hours ago. You'll be saying 4 lakhs, I'm sure. I know... Based compensation. Okay. So I had to make some guesswork on this maintenance. I know it's too high. I just don't know how much lower it will normalize to. I'm out of touch of the market really. So I will need help on this one.

You come and visit and go to the April, get yourself familiar again.

Okay. And then marketing expense, can you just give me some idea how much you think the budget...

Yes... Less than 1%.

It's much lower than pre-COVID. So pre-COVID was 1.5%. We're probably about 0.9%, 0.8% now.

Okay. Of revenue, right? -- yes. All right. And then okay, net interest, I've met we follow has given me some guidance.

A question on the chat. Chen has asked on the sensitivity to the ForEx movement. So just go to slide on the internal targets, we have actually provided the sensitivity. So about MYR 0.10 is equivalent sorry, MYR 0.10 change is about MYR 383 million impact for a full year basis. And then we've also provided the sensitivity to jet fuel, which is change is about MYR 81 million. I'll pass it to [ Jave ] you have a question?

Just one question regarding your guidance, your target, especially on the NOP margin side. So this NOP 5% is it included on the non-operating aircraft. [Technical Difficulty].

Yes, excludes the non-operating aircraft.

It excludes the nonoperating aircraft, which is assuming there will still be some...

There will be some we still have the 9 aircraft until April.

Just to clarify because your NOP 1 including an NOP and in [Technical Difficulty] operating aircraft which is high, above 600 million and on a [Technical Difficulty] basis is about 500 or million including the non-operating aircraft. If we escalate the exclude the nonoperating aircraft, it's about 1.3 billion [Technical Difficulty].

5% target, are you looking at excluding -- including the nonoperating aircraft...

Yes, excludes the nonoperating aircraft.

I'll come back to you on this later. But as you highlighted, right, this year is expected to get to full operation already. The non-ops will go away by April if everything goes to plan.

Any more questions to answer? Justin Matthew.

Just a follow-up on the margin on the internal target. So this is also before minority interest, is it?

Yes.

Yes.

Could you give us some color on after minority interest as well...

It's a bit hard to predict that, right? It's hard actually to do that.

I see. Okay. I think -- so I see you guys are expecting to do 85% load factor. So given that we did too much in the first quarter and that both and CNY is also in the first quarter this year, maybe could you give us some color on the forward booking numbers on both short and long haul. I think at the moment, 80% load factor and 84% for short-haul, should we expect slightly higher going ahead.

What do you mean for the Ra season? Is it you're asking for Ra season or for rest of the year?

For first quarter...

First quarter is very healthy. I think it will surpass -- if you just ask me for first quarter, it will be more than 85.

This is on a blended basis for both [Technical Difficulty].

Yes. Next question, Daniel.

I noticed other operating costs, which increased to MYR 200-plus million. previous quarter is 100-plus million, but now it's come to 108, to 100 plus million [Technical Difficulty].

Other OpEx 17289 [Technical Difficulty].

Repeat your question again.

Other operating experiences under the [Technical Difficulty] quarter.

It's in the quarter. In the quarter [ 1782-289 ], is quarter to quarter. No that's year-on-year.

[Technical Difficulty] compared to second Q was on [Technical Difficulty] let me just look at number, I will get back to you. [Technical Difficulty].your maintenance came down, but your -- your maintenance actually went up, but your usage charges came down slightly. So I'm just trying to check this maintenance, is it going to be going forward level of maintenance or we are looking at lower maintenance going forward?

Moving forward will be lower because most of it we have already completed all this what you call reactivation of the aircrafts. How about the user charges and other expenses? .

User charges, there's a lot in there. That's why I say we are negotiating with airports and also all our flight charges and everything. We are relooking at it and see how we can renegotiate with the authorities.

Tax deferred tax expenses in the quarters any guidance on how should we look at the tax?

Tax, mainly from [Technical Difficulty].

This quarter doesn't...

This is the reversal of our deferred tax assets because now making profit. So it's the recognition of the future profit crystallized so you have to release deferred tax assets...

So this will continue to be [Technical Difficulty] as AirAsia X continue to make profit or Asia Group. This company [Technical Difficulty].

You be both. [Technical Difficulty].

[Technical Difficulty] Malaysia or Asian numbers.

[indiscernible] asked what should I assume the tax rate 26' and 27'but tax rate [Technical Difficulty]. Question from Carl is on OTA. I see revenue per passenger on MOVE is 47% higher than OTAs. What percentage of bookings are already on? And what's the target percentage? How much commission savings do you get versus Expedia or Booking.com can we extract?

I think I mean if you look at the last quarter, towards -- that is our so I don't need to pay all those OTAs. I think moving forward, I think for this year, we're looking at least 50% to 55% bookings coming through... [Technical Difficulty].

You have a question?

I just want to clarify in your sensitivity that you shared, right, on the currency, does that include just the foreign exchange gain and losses? Or is that purely operational number?

Purely operational and also from the leases realized the leases. It doesn't include unrealized ForEx gain and losses.

Any other questions from the floor? Or from the call. Jave question.

ASK growth actually, how much contributed by the reactivation of the nonoperating aircraft and how much is from the additional aircraft or mostly from the nonoperating aircraft...

Half because our operational fleet is going from 209 to 238 whilst our total fleet is remaining flat. So it's basically largely just the increase from operational aircraft.

Okay.

End even if you look at the aircraft that we're getting, we are replacing existing fleet that are retiring this year -- so aircraft is flat.

Any last questions before I pass it to...

On the leases, do you see that the average -- because we have new aircraft orders coming in, do you see that actually the leases per aircraft actually increasing? I mean cost of leasing aircraft increasing compared to numbers?

We have plan because like, say, for example, the 4 LRs, that's on a higher aircraft leasing basis. But having said that, you will save on fuel because it's 15% more fuel efficient. The other aircraft that we're getting in, which roughly should be about third-party aircraft leases will be lower or close to average because these are older aircrafts.

If there's no other questions, I'll pass it to Bo for some closing remarks.

We are glad to be out of PL17. And I'm very, very bullish and optimistic on year 2026. I think this is a year where we will basically focus on Southeast Asia, increase market share frequency and of course, on being a network airline. So I think all of the team are working very hard Hopefully, everything goes well this year. Hopefully, you will remain ForEx, and we get all your support. Thank you very much. Anything else?

Thank you, everyone, for dialing in. If you have any questions, please feel free to reach out to me and the team [indiscernible]. Thank you so much.

Thank you.