Airasia X plans to add flight frequencies to Japan on existing routes

Long-haul budget airline, AirAsia X Bhd, is planning to increase its flight frequency on existing routes in Japan as the country was a core market for the company.

Chief Executive Officer Azran Osman Rani said the airline would announce its plan within the next few weeks along with other additional routes.

"We'll announce new routes to Japan from Kuala Lumpur because we continue to have a very good unique cost advantage operating from Kuala Lumpur and the market in Southeast Asia to Japan," said Azran after the company's listing on the Main Market of Bursa Securities.

AirAsia X operates daily flight to Tokyo and flies four times a week to Osaka.

Besides Japan, the airline also serves destinations in Australia and China and flights to Busan, South Korea, will commence next Monday.

AirAsia X will use the proceeds from its initial public offering to expand into new hubs across Asia.

"We are already in the process of the first few steps of establishing regional hubs in Thailand and Indonesia. We will be looking at possible new hubs in the context of expansion," said AirAsia X Chairman Tan Sri Rafidah Aziz.

Currently, AirAsia X operates a fleet of 12 A330-300s for scheduled services.

"We are taking delivery about 15 planes this Friday and more to come for the rest of the year as well as seven deliveries in 2014 and five deliveries in the year after," said Azran.

AirAsia X shares were traded at RM1.27 as of 11.01 am, with 105.08 million shares changing hands.

In its initial public offering (IPO), the long-haul budget airline raised about RM740.7 million in primary proceeds based on the IPO price at RM1.25 per share.

A third of the proceeds will be used for capital expenditure, including the acquisition of engineering and aircraft-related equipment and parts, as well as for the expansion of AirAsia X into new hubs.

Another about one-third of primary proceeds will be used for the repayment of bank borrowings while the balance will be used for working capital and listing expenses.