AirAsia first-quarter profit declines

AirAsia Bhd, Southeast Asia's biggest budget carrier, reported its first drop in profit in five quarters as higher fuel and finance costs eroded gains from carrying more passengers. Net income fell 39 per cent to 104.8 million ringgits ($35 million) in the three months ended March 31, the Sepang, Malaysia-based airline said in a statement today. Revenue climbed 11 per cent to 1.3 billion ringgits.

Group Chief Executive Officer Tony Fernandes has this year announced a venture in India with the Tata Group, and bought a 49 per cent stake in Philippine low-fare carrier Zest Airways Inc. as he boosts his bet on Asia's rising travel demand. The airline also placed an order for 100 additional Airbus aircraft in December to help accelerate expansion.

AirAsia fell 1.2 per cent to 3.24 ringgits in Kuala Lumpur trading before the earnings were released. The stock has jumped 26 per cent this year, outperforming a 5.6 per cent gain in the benchmark FTSE Bursa Malaysia KLCI Index.

Jet fuel expense rose to 523 million ringgits from 442 million ringgits a year earlier, according to an exchange filing.