Kuala Lumpur. AirAsia X said it swung into a net loss in its third quarter from a year earlier, blaming higher costs and lower unit revenues particularly in its main markets of Malaysia and Thailand.

The long-haul, low-cost airline cited an overall challenging environment in Malaysia together with higher marketing expenses and lower other income in Thailand, and said both regions saw operating losses.

The airline reported a small profit in its Indonesia business, supported by strong revenue from its Bali routes.

AirAsia X said costs, measured in terms of cost per available seat kilometers, rose 6 percent from a year ago, on the back of provision for doubtful debt.

A weaker ringgit against the US dollar and higher average fuel prices - up 3 percent from a year ago - also had an impact.

Revenue per available seat kilometers was down 3 percent year-on-year due to increased capacity on existing routes and promotional fares offered to stimulate new routes, it said.

For the July-September period, the airline reported a net loss of 43.3 million ringgit ($10.55 million), compared with 11 million ringgit profit a year earlier.

Revenue climbed to 1.12 billion ringgit, supported by a 23-percent growth in passenger volume and 4-percent increase in ancillary revenue per passenger.

Better operating statistics and a surge in travel during Malaysia's school holidays and Eid in August failed to cushion the impact of higher costs. Load factor - a measure of how full planes are - inched up 1 percentage point to 79 percent.

The third quarter is seasonally one of AirAsia X's leanest periods, and the airline said it expected a recovery in the following quarter, based on booking trends.

AirAsia X also said it wanted to focus on securing high-yield, high-traffic routes and build dominance in core markets across the region.

"The group also plans to add third-party leased all-economy class A330s in 2018 to focus on shorter China routes and redeploy our existing fleet to new markets," AirAsia X Group  chief executive Kamarudin Meranun said.

RHB Research, in a client note earlier this month, said AirAsia X's plans to realign some of its routes in Australia and introduce more North Asian destinations "should allow for more consistent quarterly earnings going forward."

Reuters