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Air Asia Annual Report

AirAsia X Berhad is a mid-range low-cost airline focused on the Asia-Pacific region, aiming to serve underserved markets with a vision to be the largest low-cost airline in Asia. Following a period of hibernation due to the COVID-19 pandemic, the company has resumed operations with a revitalized business model and a core fleet of 18 A330-300 aircraft as of December 2023. The report highlights the company's commitment to excellence, sustainability, and providing exceptional flight experiences while maintaining competitive pricing.

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Air Asia Annual Report

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Gautam Sharma

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WELCOME

BACK ANNUAL
REPORT
2023
CORPORATE OUR
PROFILE VISION
AirAsia X Berhad (“AirAsia X” or “the Company”) is a To be the largest low cost airline in Asia and serving
mid-range low-cost airline operating primarily in the the 3 billion people who are currently underserved
Asia-Pacific region. Established in 2006 as Fly Asian with poor connectivity and high fares.
Express (“FAX”), we started out servicing the rural areas
of Sarawak and Sabah with turboprop aircraft before
undergoing a comprehensive rebranding in September

OUR
2007, followed by our first AirAsia X flight to Australia
in November 2007.

MISSION
At the onset of the COVID-19 pandemic in 2020, AirAsia X
embarked on a period of hibernation of its scheduled flight
operations and commenced its debt restructuring by way
of a scheme of arrangement in October 2020, which was
completed and formalised on 16 March 2022 following
lodgment of the court sanction. • To be the best company to work for whereby
employees are treated as part of a big family.
AirAsia X as a Group has since then been on a steady • Create a globally recognised ASEAN brand.
course of recovery as it returned to the skies with • To attain the lowest cost so that everyone can fly
scheduled passenger flight operations to Australia with AirAsia.
(Sydney, Melbourne, Perth, and the Gold Coast), China • Maintain the highest quality product, embracing
(Beijing, Hangzhou, Shanghai and Chengdu), India (New technology to reduce cost and enhance service
Delhi and Amritsar), South Korea (Seoul and Busan), levels.
Japan (Sapporo, Tokyo and Osaka), Taiwan (Taipei),
Indonesia (Bali), and Saudi Arabia (Jeddah) from two
hubs: Kuala Lumpur and Bangkok as of January 2024.

As of 31 December 2023, we maintain a core fleet of 18

A330-300 aircraft, while our associate Thai AirAsia X
maintains a fleet size of eight A330-300 aircraft.
VALUES
• All for One, One for All
Based on a revitalised business model as we return
• Dare to Dream
stronger than before, our unit cost base is healthy,
• Make a Difference
with cost per available seat kilometre (“CASK”) of
• Celebrate All Individuals
14.90 sen and CASK (excluding fuel) of 6.85 sen for • Keep it Simple
the year ended 31 December 2023. This enables us • Be Transparent
to continue offering fares and other services that are • Have Empathy & Respect
targeted, on average, to be 30% - 50% lower than • Safety is #1
full-service carriers.

Over the past year, we continued to witness the rapid

recovery of the international travel segment within the
industry, and delivering increased value in the coming
years.

This report cover visual encapsulates the

essence of AirAsia X’s premium cabin experience
– evoking a sense of warmth as it embraces our
customers’ return to travel with us. It exudes a
sense of prestige and sophistication, mirroring
the luxurious atmosphere of our premium cabin
and reflecting our unwavering commitment For more information, please go to website
to providing exceptional flight experiences. link https://www.airasiax.com/ar.html to
WELCOME Despite facing challenging times, our dedication view AirAsia X Annual Report 2023.
BACK ANNUAL
REPORT

to excellence remains steadfast as we continue

2023

to serve our valued passengers with the highest

standards of quality and care.
AIRASIA X ANNUAL REPORT 2023

INSIDE
THIS REPORT
ABOUT AIRASIA X
• Corporate Profile
FINANCIAL STATEMENTS
118 Directors’ Report
02 Corporate Information 123 Statements of Profit or Loss
03 Corporate Structure 124 Statements of Comprehensive Income
125 Statements of Financial Position
129 Consolidated Statement of Changes in Equity

LEADERSHIP TEAM
04 Directors’ Profiles
131 Statement of Changes in Equity
133 Statements of Cash Flows
136 Notes to the Financial Statements
08 Profiles of the Leadership Team 215 Statement by Directors
215 Statutory Declaration
216 Independent Auditors’ Report
STRATEGIC PERSPECTIVE
12 Chairman’s Statement
16 CEO’s Management Discussion & Analysis OTHER INFORMATION
223 Analysis of Shareholdings
224 Directors’ Shareholdings
SUSTAINABILITY AT AIRASIA X
22 Sustainability Statement
225
227
Top 30 Largest Shareholders
Notice of the 17th Annual General Meeting
• Form of Proxy
22 Our Sustainability Approach
35 Addressing Climate Change
47 Caring for Our People & Communities
65 Delivering Economic Value via Good
Governance
78 Performance Data Table
80 GRI Content Index

CORPORATE GOVERNANCE
& ACCOUNTABILITY
88 Corporate Governance Overview Statement
98 Statement on Risk Management & Internal
Control
107 Audit Committee Report
110 Additional Compliance Information
CORPORATE
INFORMATION
BOARD OF DIRECTORS SAFETY REVIEW BOARD SHARE REGISTRAR
• ato’ Sri Mohammed Shazalli
D Tricor Investor & Issuing House
DATO’ FAM LEE EE
bin Ramly Services Sdn Bhd
Non-Independent Non-Executive
• Dato’ Fam Lee Ee (197101000970) (11324-H)
Chairman
• Benyamin bin Ismail Unit 32-01, Level 32, Tower A
Vertical Business Suite
DATUK KAMARUDIN BIN
Avenue 3, Bangsar South
MERANUN
COMPANY SECRETARY No. 8, Jalan Kerinchi
Non-Independent
Thin Pui Leng 59200 Kuala Lumpur
Non-Executive Director
(LS0009933) Wilayah Persekutuan
(SSM PC No. 202208000271) Tel : +603 2783 9299
TAN SRI ASMAT BIN KAMALUDIN
Fax : +603 2783 9222
Independent
Email : is.enquiry@
Non-Executive Director
AUDITORS my.tricorglobal.com
MS CHIN MIN MING Ernst & Young PLT
Customer Service Centre:
Independent [202006000003
Unit G-3, Ground Floor
Non-Executive Director (LLP0022760-LCA) & AF 0039]
Vertical Podium
Chartered Accountants
Avenue 3, Bangsar South
DATO’ ABDUL MUTALIB BIN Level 23A, Menara Milenium
No. 8, Jalan Kerinchi
ALIAS Jalan Damanlela
59200 Kuala Lumpur
Independent Pusat Bandar Damansara
Wilayah Persekutuan
Non-Executive Director 50490 Kuala Lumpur
Wilayah Persekutuan
DATO’ SRI MOHAMMED Tel : +603 7495 8000
STOCK EXCHANGE LISTING
SHAZALLI BIN RAMLY Fax : +603 2095 5332
Independent Main Market of Bursa Malaysia
Non-Executive Director Securities Berhad
REGISTERED OFFICE Listing Date : 10 July 2013
Stock Name : AAX
RedQ
Stock Code : 5238
Jalan Pekeliling 5
AUDIT COMMITTEE Lapangan Terbang Antarabangsa
• Dato’ Abdul Mutalib bin Alias Kuala Lumpur
• Ms Chin Min Ming 64000 KLIA
• Dato’ Sri Mohammed Shazalli Selangor Darul Ehsan
bin Ramly Tel : +603 8660 4600
Fax : +603 8660 7722
Email : aax_shareholder@
NOMINATION AND airasia.com
REMUNERATION COMMITTEE Website : www.airasiax.com
• Tan Sri Asmat bin Kamaludin
• Ms Chin Min Ming
• Dato’ Abdul Mutalib bin Alias HEAD OFFICE
RedQ
Jalan Pekeliling 5
RISK MANAGEMENT COMMITTEE Lapangan Terbang Antarabangsa
• Ms Chin Min Ming Kuala Lumpur
• Dato’ Sri Mohammed Shazalli 64000 KLIA
bin Ramly Selangor Darul Ehsan
• Dato’ Abdul Mutalib bin Alias Tel : +603 8660 4600
Fax : +603 8660 7722
Email : aax_shareholder@
airasia.com
Website : www.airasiax.com

02 AirAsia X Berhad
CORPORATE
STRUCTURE
As at 31 December 2023

AIRASIA X
BERHAD

49%
THAI AIRASIA X
49%
PT. INDONESIA
CO., LTD AIRASIA EXTRA
Indonesian joint
Thai associate
venture

100%
AAX MAURITIUS ONE
100%
AIRASIA X SERVICES
100%
AAX AVIATION
LIMITED PTY LTD CAPITAL LTD.
Aircraft leasing Logistical & Holding co. of leasing
facilities marketing services entities

100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
ONE LTD. TWO LTD. FIVE LTD. EIGHT LTD. TEN LTD. ELEVEN LTD.
Leasing entity Leasing entity Leasing entity Leasing entity Leasing entity Leasing entity

100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
TWELVE LTD. THIRTEEN LTD. FOURTEEN LTD. FIFTEEN LTD. SIXTEEN LTD.
Leasing entity Leasing entity Leasing entity Leasing entity Leasing entity

100%
AAX LEASING
100%
AAX LEASING
100%
AAX LEASING
SEVENTEEN LTD. EIGHTEEN LTD. NINETEEN LTD.
Leasing entity Leasing entity Leasing entity

2023 Annual Report 03

DIRECTORS’ PROFILES

DATO’ FAM LEE EE

Non-Independent Non-Executive Chairman

Dato’ Fam (Male), Malaysian, aged 62, was appointed Dato’ Fam sat on the Board of Trustees of Yayasan
as Non-Independent Non-Executive Director of the PEJATI from 1996 to 2007. Since 2001, he has served
Company on 24 March 2008, and on 8 September as a legal advisor to the Chinese Guilds and Association
2023, redesignated as Non-Independent Non-Executive and charitable organisations such as Yayasan SSL
Deputy Chairman. On 18 December 2023, Dato’ Fam Haemodialysis Centre in Petaling Jaya, Selangor. He was
was redesignated as the Chairman of the Company. the Honorary Advisor of the Perlis Chinese Chamber
He is also a member of the Safety Review Board of the of Commerce and Industry and Council Member of
Company. International Commercial Dispute Prevention & Settlement
Organisation (“ICDPASO”).
He received his BA (Hons) from the University of Malaya
in 1986 and LLB (Hons) from the University of Liverpool, He also serves as a Senior Independent Non-Executive Director
England in 1989. Upon obtaining his Certificate of Legal of Capital A Berhad and Director of Thai AirAsia X Co., Ltd
Practice in 1990, he has been practising law since 1991 and Malaysia-China Business Council.
and is currently a Senior Partner at Messrs Gan & Zul.

04 AirAsia X Berhad
DIRECTORS’
PROFILES

DATUK KAMARUDIN TAN SRI ASMAT

BIN MERANUN
Non-Independent Non-Executive Director
BIN KAMALUDIN
Independent Non-Executive Director

Datuk Kamarudin (Male), Malaysian, aged 63, is the Tan Sri Asmat (Male), Malaysian, aged 80, was
co-founder of the Company. Datuk Kamarudin was appointed as an Independent Non-Executive Director
appointed as a Non-Independent Non-Executive of the Company on 13 May 2013. He is the Chairman of
Director of the Company on 6 June 2006. He was the Nomination and Remuneration Committee of the
appointed as the Chairman of the Board on 3 February Company.
2010 till 3 March 2011. Datuk Kamarudin was
re-designated as the Non-Independent Executive Tan Sri Asmat graduated from the University of Malaya
Director and Group Chief Executive Officer on with a Bachelor of Arts (Honours) degree in Economics.
30 January 2015. On 1 November 2018, he was He also holds a Diploma in European Economic
re-designated as a Non-Independent Non-Executive Integration from the University of Amsterdam.
Director.
Tan Sri Asmat has vast experience of over 35 years in
In December 2001, Datuk Kamarudin, together with various capacities in the public service and his last post
Tan Sri Tony Fernandes, Allahyarham Dato’ Pahamin as the Secretary General of the Ministry of International
Ab Rajab and Dato’ Abdul Aziz bin Abu Bakar acquired Trade & Industry Malaysia, a position he held since May
struggling domestic airline AirAsia and, with the help 1992. In the last five (5) years prior to his retirement
of Conor McCarthy, relaunched it as a pioneer of in 2001, Tan Sri Asmat served as a Board member
budget travel in Asia, building AirAsia into the world’s of Malaysia Technology Development Corporation,
best low-cost carrier. Multimedia Development Corporation, Malaysian
Trade Development Corporation, Permodalan Nasional
Prior to setting up the Company, Datuk Kamarudin Berhad, Small and Medium Industries Development
worked at Arab-Malaysian Merchant Bank from Corporation and Perbadanan Johor.
1988 to 1993 as a Portfolio Manager, managing both
institutional and high net-worth individual clients’ Currently, Tan Sri Asmat is the Chairman for
investment funds. In 1994, he was appointed Executive Perusahaan Otomobil Kedua Sdn Bhd (“PERODUA”)
Director of Innosabah Capital Management Sdn Bhd, and Compugates Sdn Bhd. He is also a Director of the
a subsidiary of Innosabah Securities Sdn Bhd. He JACTIM Foundation.
subsequently acquired the shares of the joint venture
partner of Innosabah Capital Management Sdn Bhd,
which was later renamed Intrinsic Capital Management
Sdn Bhd.

He received the Darjah Panglima Jasa Negara (“PJN”),

which carries the title Datuk, from the Malaysian King
in November 2013.

Datuk Kamarudin is the Non-Independent Executive

Chairman of Capital A Berhad and AirAsia Berhad. He
is also a Director of Red Giants Football Club.

2023 Annual Report 05

DIRECTORS’
PROFILES

MS CHIN MIN MING DATO’ ABDUL MUTALIB

Independent Non-Executive Director
BIN ALIAS
Independent Non-Executive Director

Ms Chin (Female), Malaysian, aged 53, was appointed Dato’ Mutalib (Male), Malaysian, aged 63, was
as an Independent Non-Executive Director of the appointed as Independent Non-Executive Director
Company on 1 December 2022. She is also the of the Company on 29 September 2023. He is also
Chairman of the Risk Management Committee of the Chairman of the Audit Committee of the Company
Company and a member of the Audit Committee and a member of the Nomination and Remuneration
and Nomination and Remuneration Committee of the Committee and Risk Management Committee of the
Company. Company.

Ms Chin holds a Bachelor of Science in Computer Dato’ Mutalib graduated with a Bachelor of Science
Science from the University of Victoria, Canada, and in Accountancy from Northern Illinois University and
a Senior Executive Master of Business Administration a Master of Business Administration, from Governors
from the Melbourne Business School. She is also a State University, Illinois in the United States of America.
Certified Information Systems Security Professional
(“CISSP”). Dato’ Mutalib started his career at the Chase Manhattan
Bank in 1985 as a Credit Analyst and has extensive
She has extensive experience in Digital Transformation, exposure in both Commercial and Investment Banking.
Strategic Innovation and Technology Entrepreneurship. He was Vice President, Investment Banking at Chase
She had successfully implemented Financial Inclusion Manhattan Bank from 1994 to 2000. He moved
for migrant workers and refugees, digitalised into the public sector and served various Ministries
Compliance Audit Tool for industry best practice including the Ministry of Finance, Ministry of Science,
standards, developed a world-first Data Security & Technology and Innovation, Ministry of Energy, Water
Access Control token with built-in RFID, designed and Communications and Ministry of Work between
the Digital ID blueprint for the first Multi-Application 2000 to 2011. In 2011, he was tasked to set up a new
National ID Card in the world, delivered Labuan Halal Government housing agency, Perumahan Rakyat
Hub and National Food Traceability platform, and 1Malaysia or PR1MA and served as its Chief Executive
more. She is well-versed in technology valuation and Officer until January 2019.
acquisition. She raised the highest tech startup fund in
Asia during the Asian Financial Crisis and was the first Dato’ Mutalib has also served the MARA Council and
in Malaysia to receive funding from Draper Investment. was a Board member of Bank Rakyat and Bintulu Port
Holdings Berhad and is presently the Non-Independent
Further, she is actively involved in ESG and advising Non-Executive Chairman of Icon Offshore Berhad
companies on Sustainability Risks Management and Independent Non-Executive Board member
and Compliance. She is familiar with sustainability of Prolintas Managers Berhad and Ekuinas Berhad
reporting standards and the Bursa Malaysia’s Enhanced respectively.
Sustainability Reporting Framework.

06 AirAsia X Berhad
DIRECTORS’
PROFILES

DATO’ SRI MOHAMMED

SHAZALLI BIN RAMLY
Independent Non-Executive Director

Dato’ Sri Mohammed Shazalli (Male), Malaysian, aged

62, was appointed as Independent Non-Executive Declaration of Directors:
Director of the Company on 29 September 2023. He
is also Chairman of the Safety Review Board and a • Family Relationship
member of the Audit Committee and Risk Management None of the Directors has any family
Committee of the Company. relationship with any other Director and/or
major shareholder of AirAsia X
Dato’ Sri Mohammed Shazalli holds a Bachelor
of Science (Marketing) from Indiana University • Conflict of Interest
Bloomington, Indiana and a Master of Business None of the Directors has any conflict of interest
Administration from St. Louis University, Missouri with AirAsia X
in the United States of America. He spent his early
education in MARA Junior Science College (“MRSM”) • Conviction for Offences
and University Teknologi MARA (“UiTM”), Perlis. None of the Directors has been convicted for
any public offence during the financial year
He began his career with Unilever, Malaysian Tobacco ended 31 December 2023 or had any penalty
Company and British American Tobacco Company, imposed by the relevant regulatory bodies
both in Malaysia and the United Kingdom focusing on within the past five (5) years, other than traffic
strengthening their brands from 1987 to 1996 before offences, if any
joining ASTRO in 1996 as the Marketing Director
for two (2) years where he pioneered the launch of
ASTRO digital satellite services in Malaysia. He then
expanded his horizon and became the Chief Executive
Officer (“CEO”) of NTV7, Malaysia’s seventh terrestrial
TV station, for eight (8) years since its launch in 1998.

Dato’ Sri Mohammed Shazalli also brings extensive

directorship experience, where he was previously the
regional CEO and Corporate Executive Vice President
for Axiata Group Berhad’s South East Asia operations,
after being promoted from his previous position as the
CEO and director of Celcom Axiata Berhad, a position
he held from 1 September 2005 until 31 August 2016.

Dato’ Sri Mohammed Shazalli was the Group Managing

Director and CEO of Telekom Malaysia Berhad as
well as a consultant at Strategic Brand Resources
& Consultancy Sdn Bhd prior to his appointment
as Group Managing Director of Boustead Holdings
Berhad on 1 December 2020.

Dato’ Sri Mohammed Shazalli had also served as

Chairman of PR1MA Communication Sdn Bhd and
Pharmaniaga Sdn Bhd and also a Board member of
Perbadanan PR1MA Malaysia and Malaysia Airlines
System Berhad. He was also one of the seven (7)
members in the task force led by the Performance
Management & Delivery Unit (“PEMANDU”) to oversee
Proton Holdings Berhad’s transformation plan.

2023 Annual Report 07

PROFILES OF THE
LEADERSHIP TEAM
BENYAMIN ISMAIL
Chief Executive Officer
LAVINIA LOUIS
Chief Financial Officer

Date of Appointment: 1 September 2015 Date of Appointment: 1 October 2023

Age Gender Nationality Age Gender Nationality

47 41
Responsibilities: Responsibilities:
• Provides leadership and vision towards increasing • Oversees financial planning and analysis, including
shareholder value and growth of AirAsia X while forecasting and analytical activities that support
delivering our sustainability commitments strategic business decision-making
• Manages the Group’s business and affairs, ensuring • Coordinates the development of annual operating
operational excellence and strong governance capital and program budgets, as well as reporting
• Executes AirAsia X’s turnaround plan on it
• Develops and spearheads high-level business and • Ensures cash flow is compatible with operations
growth strategies in line with AirAsia X’s vision and by overseeing day-to-day accounting, recording,
mission, as approved by the Board reporting, and internal-control activities of the
Company
Experience: • Develops and implements best practices and tools
• Handled Debt Capital Markets portfolio at Affin to ensure a well-controlled yet flexible organisation
Investment Bank, 2003 that has strong fiscal management, project
• Joined Maybank Investment Bank as a manager in coordination, cross-team communications, and
Debt Capital Markets, 2004 workflows
• Joined CIMB Investment Bank focusing on Debt • Complies with national and local financial
Capital Markets, 2007 requirements and ensures adherence to existing
• Joined AirAsia as Head of Investor Relations, 2010 and new legislation
• Promoted to Group Head of Investor Relations, • Liaison person with regulators, financial institutions,
Corporate Development and Implementation, 2014 external auditors and the Board
• Appointed AirAsia X Chief Executive Officer (CEO)
effective 1 September 2015 after assuming the role Experience:
of Acting CEO on 30 January 2015 • Joined PricewaterhouseCoopers Kuala Lumpur
in 2005 and gained 8 years of experience in
Qualifications and Professional Membership: performing financial audits, managing regulatory
• Bachelor of Commerce (Banking & Finance), Curtin reporting and risk assessments
University of Technology, Australia • Joined AirAsia Berhad as Financial Controller in 2012
• Master of Electronic Commerce, Edith Cowan and was instrumental to the group reorganisation
University, Australia exercises, disposal of large portfolios of aircraft,
and the implementation of various accounting
Membership of Board Committees in AirAsia X: systems in simplifying business processes
• Safety Review Board • Promoted to Head of Finance in AirAsia Berhad in
January 2023
Present Directorship in Associates/Affiliates: • Appointed to Chief Financial Officer of AirAsia X
• Benyamin is a Director in Thai AirAsia X Co., Ltd Berhad in October 2023
• Benyamin is a Director in Ground Team Red
Sdn Bhd Qualifications and Professional Membership:
• Bachelor of Business, Major in Accounting, Monash
Additional Information: University, Australia
• Benyamin does not own any AirAsia X’s shares • Professional Qualification, Member of Certified
Practicing Accountant (CPA Australia)
• Professional Qualification, Member of Malaysian
Institute of Accountants (MIA)

Additional Information:
• Lavinia does not own any AirAsia X’s shares

08 AirAsia X Berhad
PROFILES OF THE
LEADERSHIP TEAM

MOSES DEVANAYAGAM
Senior Director
CAPT SURESH BANGAH
Director of Flight Operations

Date of Appointment: 1 October 2013 Date of Appointment: 1 October 2013

Age Gender Nationality Age Gender Nationality

73 49
Responsibilities: Responsibilities:
• Leads the coordination of operational functions • Coordinates, supervises and monitors the functions
within the Group, airport authorities and and performance of management personnel, pilots,
government agencies including the Malaysian cabin crew and all departments within Flight
Aviation Commission and the Civil Aviation Operations
Authority of Malaysia • Manages the safety and security of all flights
• Advises and mentors the Operations team • Liaison person with local and international
• Instrumental in setting up Operations functions regulators, ensuring operations are in line with the
including Cargo, Flight Operations, Engineering, Air Operator Certificate
Ground and Group Operations, Inflight Operations, • Represents the Company’s interest in national and
Safety and Security international bodies and institutions as far as flight
operations are concerned
Experience:
• 53 years of aviation experience including key Experience:
positions in leading airlines in Singapore and • Started as a pilot with AirAsia, 2003
Malaysia: • Internal auditor of Flight Operations at AirAsia,
- Joined Malaysia-Singapore Airlines, 1971 2005
- Served Malaysia Airline System Berhad in • Cadet Pilot Coordinator managing the Cadet Pilot
various senior management positions including Training Programme, 2007 – 2009
General Manager- Operations, Head of Contracts • Flight Deck Recruitment Manager responsible for
Management and Warranty and Contracts hiring and promoting pilots, 2009 – 2010
Manager, 1972 • Joined AirAsia X as Chief Pilot, Operations, 2010
- Joined AirAsia X as Director of Operations, • Director of Flight Operations, 2013
2007
- Regional Head of Operations of AirAsia Berhad, Qualifications and Professional Membership:
2009 • Air Transport Pilot License, 1999
- Appointed as Senior Director, 2013 • A320 Type Rating License, 2007
• A340 Type Rating License, 2009
Qualifications and Professional Membership: • A330 Type Rating License, 2011
• Associate Member of the Royal Aeronautical • MIT Sloan School of Management Leadership
Institute United Kingdom (by award), 1975 Programme
• Cadet/apprentice Technical Services in-house • Cranfield University Leadership Programme
training with Malaysia-Singapore Airlines, 1971/72 • Cranfield University Accident Investigation
• Type-rated Approvals from Qantas and Air New Programme
Zealand, 1971

2023 Annual Report 09

PROFILES OF THE
LEADERSHIP TEAM

LIM KOK HOOI

Head of Corporate Safety
WONG OOI LING
Head of Internal Audit

Date of Appointment: 22 January 2018 Date of Appointment: 1 July 2016

Age Gender Nationality Age Gender Nationality

53 53
Responsibilities: Responsibilities:
• Provides guidance and direction for AirAsia X’s • Provides independent and objective assurance as
Safety Management System to the adequacy and effectiveness of system of
• Ensures safety documentation accurately reflects internal controls, risk management and governance
the current situation, monitors the effectiveness of processes
corrective actions, and provides periodic reports
on safety performance Experience:
• Provides independent advice to the CEO, senior • Joined PricewaterhouseCoopers in its Audit and
managers and other personnel on safety-related Assurance Department, 1995
matters • Joined EON Bank Berhad as Corporate Planning
Manager, 2000
Experience: • Vice President of Group Management Services and
• Kok Hooi has been in the airline industry since the PMO, EON Bank Berhad, 2003
early 1990s, and has broad experience in safety and • Joined Measat Broadcast Network Systems Sdn
training with over 15,000 flying hours: Bhd (Astro) as a Senior Manager in Planning,
- Started commercial flying in the Dornier 228, Broadcast and Operation, 2007
then Twin-Otter (DHC-6), Fokker 50, B737, • Joined DRB-HICOM Group as a Senior Manager in
A340 and, now, A330 GST PMO, 2014
- Joined Malaysian Helicopter Services as a • Joined AirAsia X as Head of Corporate Quality and
co-pilot, and was seconded to Pelangi Air Sdn Assurance, 2016
Bhd, Kuala Lumpur, and to Royal Air Cambodge, • Took on expanded role as Head of Internal Audit
Phnom Penh, 1992 cum Corporate Quality Assurance in 2020
- Joined Malaysia Airlines as a Captain of DHC-6
Twin Otter, based in Miri, Sarawak, following which Qualifications and Professional Membership:
he became a Captain of Fokker 50, B737-400 and • Bachelor of Business (Accounting), Monash
B737-800, 1997 University, Australia
- Joined AirAsia X as a Captain of A340/330, • Member of the Malaysian Institute of Accountants
leading the flight data monitoring team, 2011 (MIA)
- Became Chief Pilot Flight Safety, 2016
- Appointed to current post of Safety Director,
January 2018

Qualifications and Professional Membership:

• Commercial Pilot License Australia
• Commercial Pilot License Malaysia
• Airline Transport Pilot License Malaysia
• Type Rated Instructor (TRI) A340/A330/Fokker
50/DHC-6 Twin Otter
• Member of Malaysia National Runway Safety Team
• Member of Malaysia Flight Safety Team
• IATA-qualified trained SMS implementer
• Cranfield University Certified Aviation Investigator
• IATA-trained Aviation Auditor

10 AirAsia X Berhad
PROFILES OF THE
LEADERSHIP TEAM

CAROLINE LEE
General Counsel
ALVIN TAN
Head of Engineering

Date of Appointment: 5 July 2021 Date of Appointment: 1 April 2022

Age Gender Nationality Age Gender Nationality

59 37
Responsibilities: Responsibilities:
• Manages the Group’s legal risk by providing • Provides leadership and vision to the Engineering
strategic and commercially driven legal advice to Department with the primary focus on aligning
the Board of Directors and senior management technical capability with AirAsia X’s business needs
• Primary contact for advising on all legal matters for • Oversees the main pillars in Engineering; CAMO,
AirAsia X Subcontracted Maintenance Part-145 and Quality
• Collaborates with all stakeholders, leading internal Assurance
and external legal negotiations and ensuring legal • Manages Fleet Planning and Aircraft Lease
compliance in the conduct of business Evaluation to ensure route and business growth
• Manages the Legal Department, providing strategies are in line with AirAsia X’s vision
leadership and guidance to members of the team • Oversees Cost & Resource Tracking and Budgeting
• Works closely with external counsel to ensure • Ensures implementation of work culture, safety
effective and efficient delivery of commercial culture and engineering policies and procedures
results for AirAsia
Experience:
Experience: • Joined AirAsia Berhad, Chief of Design Assurance
• Private legal practice in Singapore and Malaysia, Section, 2010
1990-2002 • Joined Airbus as Field Services supporting airlines
• Partner, Banking and Capital Markets, Messrs in Singapore, Hong Kong and South Korea, 2013
Rashid & Lee, 2000 • Promoted to Customer Support Director/Field
• Head of Legal, Usaha Tegas Group, Oil & Gas, 2002 Services Manager performing both commercial and
• Chief Operating Officer, Melium Sdn Bhd, 2006 technical role to airlines in the SEA Region, 2018
• F&B owner and operator, 2011 • Joined AirAsia X Berhad as Head of Engineering,
• Consultant, 2017 – 2021 2022

Qualifications and Professional Membership: Qualifications and Professional Membership:

• Advocate and Solicitor, Malaysia • Bachelor of Science, Aerospace Engineering,
• Barrister and Solicitor, Australian Capital Territory Missouri University of Science & Tech, USA
• Advocate and Solicitor, Singapore • Airbus A330, A350 Type Trained
• Barrister-at-Law, England & Wales
• Bachelor of Laws (LL.B, Hons), University of London

Declaration of Leadership Team:

• Family Relationship
None of the Leadership Team has any family relationship with any other Director and/or major shareholder
of AirAsia X

• Conflict of Interest
None of the Leadership Team has any conflict of interest with AirAsia X

• Conviction for Offences

None of the Leadership Team has been convicted for any public offence during the financial year ended
31 December 2023 or had any penalty imposed by the relevant regulatory bodies within the past five (5)
years, other than traffic offences, if any

2023 Annual Report 11

Chairman
Statement
Dear Shareholders,
I am pleased to present AirAsia X’s Chairman Statement
for the financial year 2023. This marks yet another
momentous milestone in our corporate journey, and
I extend my sincere gratitude for your steadfast support
thus far. In the last Annual Report, my predecessor,
YM Tunku Dato’ Mahmood Fawzy spoke of the restart of
the Company’s commercial flight operations following
a tumultuous period of lockdowns world over. The
aviation sector faced unparalleled challenges during
this time, leading to a temporary cessation of AirAsia X’s
operations, followed by an extensive debt restructuring
scheme spanning from 2021 to 2022.

12 AirAsia X Berhad
n’s
Subsequently, in less than one year
since the resumption of operations,
AirAsia X charted a Net Profit of
RM33.3 billion for the financial period
ended 2022, primarily attributed to
the write-back of provisions. We
The team worked diligently to
validate the viability of the revitalised
model designed for the new, post-
pandemic landscape, ensuring
its resilience and adaptability.
With the Company completing its
Harnessing the strength of our
robust network and operational
expertise, the Board is diligent in
ensuring that the management
team is steadfast in capitalising on
the emerging opportunities in this
were encouraged by the remarkable restructuring in early 2022, coupled evolving paradigm. Our focus was
momentum observed during that with sustained profitability each directed towards the selection of
period for the recovery of the quarter, AirAsia X successfully routes with proven demands and
Company. Now, as we present to emerged from the PN17 classification, favourable yields while optimising
you AirAsia X’s 2023 Annual Report, and we are now well-positioned to fleet utilisation to enhance the
I am honoured to announce that last pursue new opportunities and steer organisational efficiency as a whole.
year, the Company maintained its the future growth of the Company
steadfast progress in recovery and for the benefit of all stakeholders. Demand for travel remained strong
onward sustainable growth. Notably, Against the backdrop of the evolving well into 2023, building upon the
in the full financial year ended 2023, industrial dynamics and the embrace momentum of the final quarters
AirAsia X recorded a Net Profit of of the future norms within the sector, of 2022. In the preceding year, the
RM331.5 million with its annual the Company’s renewed focus on its Company kept its pace gradual as it
turnover trending at RM2.5 billion, strategic initiatives has never been methodically reintroduced its fleet
recovering close to 60% of its more critical - as we progress further, back on stream after over 30 months
2019-level records - a commendable we are committed to harnessing the of hiatus, with the addition of new
resurgence, considering the airline momentum gained recently to propel lease arrangements underway.
has yet to operate at the maximum the Company towards success. The year 2023 marked the full
available capacity. implementation of the Company’s
Having served on the Board of comprehensive recovery plan,
It brings me great pleasure to share the Company for over 16 years, particularly with the expansion of its
that the crowning achievement I have borne witness to the myriads fleet. Our fleet size increased from 14
in 2023 is that the Company of challenges and triumphs that aircraft in 2022 to 18 aircraft, with 16
has successfully navigated its have characterised the Company. of these aircraft fully operational by
way out of the Practice Note 17 Throughout this period, the December 2023. In 2023, AirAsia X
(“PN17”) classification, marking resilience and adaptability of ended the year with 22 destinations
a significant achievement for our the Company have consistently within its network, doubling its
organisation. Reflecting on our prevailed, affirming our capacity to weekly flight counts to 144 flights
journey thus far, it is impossible to overcome obstacles that come our from weekly flight numbers charted
overlook the profound impact of way. Following the resumption of in 2022.
the pandemic which precipitated our scheduled flight operations in
the near-complete cessation of our 2022, AirAsia X has demonstrated
operations in 2020, and ultimately remarkable resilience and skill
led to the imposition of the PN17 in navigating the ever-intricate
classification in 2021, owing to the operating environment, particularly
financial uncertainties at the time. in a post-pandemic world. In 2023,
Overcoming this classification was a as travel restrictions eased further,
protracted endeavour, exacerbated and passenger demand continued to
by the persistent scepticism of the chart its pace anew, we see recovery
industry even after the Company on the right trajectory.
could restart its operations in mid-
2022.

2023 Annual Report 13

CHAIRMAN’S
STATEMENT

Underscoring its strategic growth delivered consistent recovery and On a global scale, the efforts to
initiatives, AirAsia X most recently, growth, continually driving its revenue prioritise sustainability initiatives
in March 2024, celebrated the launch and profitability on a quarterly remain at the forefront of the
of our inaugural flight to Almaty in basis. For the financial year ended overarching commitment to
Kazakhstan. This heralds immense 31 December 2023, the Company’s humanity’s long-term survival and
prospects that could be unlocked CASK stood at 14.90 sen, while CASK prosperity. While we acknowledge
via enhanced connectivity within ex-fuel is healthy at 6.85 sen. the importance of fortifying our
the region and beyond. What’s profit margins and financial position,
even more exciting is that all of As an airline, the safety and well- particularly in the aftermath of
this is happening in addition to the being of our guests and our Allstars a protracted disruption to our
anticipation we have for China’s is of unparalleled importance for business operations in recent years,
return to the forefront of international both the Board and the management we are also conscious of our broader
travel. Recent indicators have been team. As we adapt ourselves to responsibility to contribute to a
exceedingly promising - with the the operational landscape in this growing industry that is sustainable,
removal of visa requirements, our post-pandemic era, we maintain an inclusive and equitable.
destinations in China, namely Beijing, unwavering commitment to excellence
Chengdu, Hangzhou, and Shanghai which compels us to continually Within this Annual Report, I am
have in recent months shown a enhance every segment of our pleased to present to you AirAsia X’s
promising load factor of over 90% operations. In 2023, AirAsia X proudly Sustainability Statement, featuring its
across all routes, signifying that served over 2.8 million passengers, inaugural sustainability framework,
demand is indeed robust and poised a significant increase from the from page 22 to 87. Additionally, I am
for expansion in this market. preceding year’s figure of just over delighted to present the Company’s
417,000 passengers. Corporate Governance Overview
Our business model is premised Statement which is detailed from
upon operational efficiency, which Recognising that stringent page 88 to 97. This comprehensive
facilitates cost-effectiveness and safety procedures and protocols, overview articulates the Company’s
ultimately bolsters profitability. Last coupled with strict governance are internal processes and practices that
year, we shared how the Company indispensable pillars for upholding align with the esteemed standards
pursued enhanced efficiencies, with the paramount standards of of the Malaysian Code of Corporate
a particular focus on improving its operational integrity, we remain Governance (“MCCG”).
turnaround times amidst the early steadfast in ensuring this is not
stages of recovery of our network. compromised. As a member of By adhering to these principles,
As a result, for the financial quarter the Company’s Safety Review we present our commitment
ended 31 December 2022, its cost Board, I am privileged to assure to continually fostering the
per available seat kilometre (“CASK”) you of the steadfast dedication improvement in our corporate
stood at 9.98 sen while CASK ex-fuel the Company has in maintaining governance standards and operational
was at 1.42 sen. exemplary safety standards in our methodologies. Looking ahead, we
day-to-day operation, ensuring anticipate maintaining a culture
Building on this foundation, in proactive identification, mitigation, of refinement of the Company’s
the ensuing 12 months of 2023, I and minimisation of any potential governance framework, particularly
am pleased to share that AirAsia risk factors, thereby safeguarding in sustainability considerations.
X continued to exhibit improved the well-being of all stakeholders By conducting periodic reviews
financial performance, a strong involved. of our practices, we endeavour to
demonstration of the team’s strengthen our strategic initiatives
enduring commitment to operational and accelerate the progress towards
excellence which serves as the our aspirations for sustainability.
cornerstone for cost optimisation
within the Company’s operational
landscape. Despite prevailing
uncertainties within the operating
environment today, AirAsia X has

14 AirAsia X Berhad
CHAIRMAN’S
STATEMENT

I extend my heartfelt gratitude to As we navigate this journey

my predecessor YM Tunku Dato’ together, I gratefully acknowledge
Mahmood Fawzy for his exemplary the unwavering support of you,
leadership and guidance to the our esteemed shareholders. Your
Board as well as the management support has been instrumental in
team through AirAsia X’s recent our progress thus far, and I am truly
transformative journey, leading up honoured to express my sincere
to the successful exit from the PN17 appreciation. We have achieved
classification. Since our last Annual multiple significant milestones
General Meeting, there have been a together, and we recognise that
few other changes with your Board. there remains much to be done.
With your continued support, we
In this regard, I am privileged to have confidence that we are indeed
welcome Dato’ Abdul Mutalib and empowered to persevere and realise
Dato’ Sri Mohammed Shazalli, who our dreams and aspirations for the
joined our Board in 2023, bringing enduring success of the Company.
with them a wealth of corporate
expertise and experiences. Presently, Thank you.
Dato’ Abdul Mutalib assumes the
pivotal role of Audit Committee Dato’ Fam Lee Ee
Chairman while Dato’ Sri Mohammed Chairman
Shazalli now heads the Company’s AirAsia X Berhad
Safety Review Board. I am confident
that their invaluable insights will
enhance the Company’s governance
framework and operational
effectiveness.

Looking ahead, in the face of the

perpetual evolution of the aviation
industry, I am optimistic about the
synergy and collaboration that we
have nurtured over the years with
the wider Capital A Group. I am
confident that our collective efforts
will serve to reinforce our existing
foundation here, where we call
home, while also extending our reach
across new horizons, facilitating
enhanced global connectivity and
accessibility.

2023 Annual Report 15

CEO’S
Management Discussion &
Analysis

Dear Esteemed
Shareholders,
I am honoured for this opportunity to present to you
AirAsia X’s Annual Report for the financial year 2023. As
I address you annually in this capacity, it is vital to recall
the significance of the Company’s endeavours from the
past year, which have been nothing short of remarkable.
Reflecting on the content of AirAsia X’s last Annual
Report, I take pride in sharing that AirAsia X had resumed
normalised level of commercial flight operations in 2023.

16 AirAsia X Berhad
CEO’S MANAGEMENT
DISCUSSION & ANALYSIS

As we thumb through the pages of this year’s Annual Report, I am delighted to share that the Company has
continued its trajectory towards a thrilling recovery in 2023, leveraging on the post-pandemic operational paradigm
that has progressively normalised in the past year. AirAsia X had attained significant milestones throughout its
journey in recovery, with the particularly notable one being the emergence of the Company from the Practice
Note 17 (“PN17”) classification in November 2023. Reflecting upon our path thus far, it is clear that the pandemic
had a deep impact on AirAsia X, and the classification of PN17 on the Company in 2021 amidst the financial
uncertainties of that time, posed an incredible challenge to us indeed.

However, since the airline was able to resume its operations in April 2022, the team had remained steadfast in
implementing the Company’s revitalised business model, which is aimed at sustained growth and profitability,
ultimately rising above the PN17 classification and fortifying its position and gaining market leadership in regions it
services. This effort, marked by the endurance and determination of the Company, indicated AirAsia X’s dedication
to onward growth and stability. Overcoming these challenges amidst the prevailing scepticism surrounding the
airline industry’s post-pandemic soundness proved to be an arduous task, and it is with great honour that I now
share AirAsia X’s narrative of recovery and adaptability. This reflects not only AirAsia X’s unwavering spirit but
also its capacity to navigate adversities with resilience and prudence.

Back in April 2022, AirAsia X resumed its flight operations, embarking on a thoroughly planned process to
reintroduce its scheduled services. Starting with routes to Seoul and Delhi, the airline progressed to expand its
network throughout the latter part of 2022 and well into 2023. This methodical approach provided AirAsia X
with the avenue to capitalise on the sustained and sizable demand for air travel which persisted solidly for the
entirety of 2023.

The fiscal year 2023 was pivotal as we executed an extensive recovery plan that was devised and improvised on
ever since the near-halt of the Company’s operations back in 2020. Notably, significant milestones were achieved
in fleet expansion since the restart of our operations. Immediately following the conclusion of the Company’s
Debt Restructuring in 2022, we were down to nine aircraft and had expanded to 14 aircraft by the end of 2022. In
2023, AirAsia X’s fleet size grew further to 18 units of A330-300 by December 2023. At the time of writing of this
statement, nearly 90% of the fleet was fully activated and operational, with the remaining two aircraft slated for
reactivation by the first half of 2024. This expansion of AirAsia X’s available capacity heralds a promising avenue
for our continued growth and operational efficiencies.

It is with great enthusiasm that we share that AirAsia X has managed to double its weekly flight frequency to
144 flights by December 2023, notwithstanding that we have yet to fully reactivate all of our fleet. At the time of
writing, AirAsia X services Australia (Sydney, Melbourne, Perth, and the Gold Coast), China (Beijing, Hangzhou,
Shanghai, Chengdu, Hong Kong and Xi’an), India (New Delhi and Amritsar), South Korea (Seoul and Busan),
Japan (Sapporo, Tokyo and Osaka), Taiwan (Taipei), Indonesia (Bali), Saudi Arabia (Jeddah), Thailand (Bangkok),
Kazakhstan (Almaty), with seasonal services to Kota Kinabalu to support the overwhelming demand during the
peak holiday season. This expanded network highlights AirAsia X’s dedication to meeting the advancing needs
of our guests and is poised to strengthen our position within the industry.

For the full financial year, AirAsia X served a total of 2.8 million passengers, marking a substantial increase of over
sixfold compared to the figures recorded in 2022 (2022: 417,195 passengers), while Passenger Load Factor (“PLF”)
increased by a commendable two percentage points to 80% (2022: 78%). In our concerted effort to expand our
operational capacity, AirAsia X’s Available Seat Kilometres (“ASK”) capacity grew by over seven times in the past
12 months, attributed to the reinstatement of aircraft into service and the expansion of our network. Notably, the
PLF that we have recorded indicated that demand for travel remains elevated.

Collectively, these metrics underscored the efficiency of AirAsia X’s initiatives and operational enhancements that
were put into motion between 2020 to 2022, geared towards the return to normalcy in our operation, which has
materialised all through the course of 2023.

2023 Annual Report 17

CEO’S MANAGEMENT
DISCUSSION & ANALYSIS

Overview of Group’s Business and Operations

FYE 2023 FPE 2022
(‘000) (‘000)
Restated
Revenue (RM) 2,527,096 825,860
Total Operating Expenses (RM) (2,048,129) 32,679,640
EBITDA/LBITDA (RM) 663,362 33,545,770
Net Operating Profit/Loss (RM) 369,068 32,744,086
Profit/Loss Before Tax (RM) 343,773 32,696,344
Taxation (RM) 12,268 612,241
Net Profit/Loss (RM) 331,505 33,308,585
Total Assets (RM) 3,137,573 2,482,794
Basic Earnings/Loss per Share (sen) 74.2 8,029.7

Review of Financial Results and Financial Condition

AirAsia X Berhad (“AirAsia X” or “the Company”) and the subsidiaries of AirAsia X (“the Group”) reported a
turnover of RM2.5 billion for the financial year ended 31 December 2023 (“FYE 2023”) (2022: RM825.9 million),
and recorded total operating expenses of RM2.0 billion against a total operating income of RM32.7 billion in 2022
which came on the back of reversal of provisions made during the Debt Restructuring in 2021. For fiscal year
2023, the Group posted earnings before interests, taxes, depreciation and amortisation (“EBITDA”) of RM663.4
million (2022: RM33.5 billion), while net operating profit stood at RM369.1 million (2022: RM32.7 billion). The
Group closed the FYE 2023 with a net profit of RM331.5 million (2022: RM33.3 billion), reflecting a normalised
profitability level following the reversal of provisions observed in the preceding year. This year under review, the
Group presented a close to 60% recovery of its 2019-level revenue and a successful turnaround in profitability
driven by the sustained demand in line with the recovery of the industry - a remarkable feat given that the airline
has yet to operate on full available capacity.

Group’s Earnings

Revenue

The Group recorded revenue of RM2.5 billion (2022: RM825.9 million) for the financial year, mainly driven by
an increase in the number of passengers carried against a backdrop of additional aircraft inducted into service
between January to December 2023, and further bolstered by the sustained demand for travel in the regions the
Group operates in. In 2023, scheduled flight operations delivered revenue of RM1.7 billion (2022: RM272.4 million),
and ancillary revenue stood at RM682.3 million (2022: RM78.5 million), reflecting multifold growth against the
preceding financial period. The Group’s freight services and charter flights each reported revenues of RM151.7
million (2022: RM341.6 million) and RM18.8 million (RM105.6 million) respectively, as the Group’s scheduled flight
operations normalised in its recovery trajectory. As the Group completed the termination of its sub-leases of
aircraft to its associate, Thai AirAsia X Co., Ltd (“AirAsia X Thailand”) in 2022, no aircraft operating lease income
was recorded for 2023 (2022: RM27.2 million).

Expenditure

For the financial year under review, the Group’s total operating costs were driven largely by aircraft fuel expenses.
This came as no surprise as the Group continued to recover its operational level, with additional scheduled flight
operations compared to the preceding financial period. This cost segment was further heightened due to the higher
jet fuel price as well as the weaker local currency against the greenback. Aircraft fuel expenses charted RM1.3 billion
(2022: RM354.9 million), followed by maintenance and overhaul expenses at RM351.0 million (2022: RM472.4 million).

18 AirAsia X Berhad
CEO’S MANAGEMENT
DISCUSSION & ANALYSIS

As the business recovered, the Group’s staff costs increased to RM204.1 million (2022: RM106.4 million) on
the back of hiring of additional staff and operational crew. As the pay-by-hour arrangements continued
with its lessors, the Group recorded aircraft operating expenses of RM72.2 million (2022: RM33.6 million);
the pay-by-hour arrangement is expected to conclude by the upcoming financial year 2024. In 2023, the
Group reported user charges amounted to RM247.6 million (2022: RM97.0 million) as the Group added more
destinations and flights into its network.

On the back of the reversal of provisions made for the Group’s Debt Restructuring and provision for the additional
loss in the investment made towards our joint venture in Indonesia due to the potential tax exposure to the Group,
the Group posted positive other operating income of RM239.6 million (2022: RM34.3 billion).

Group Financial Position

The Group’s net gearing stood at nil for the FYE 2023, as the Group did not have loan financing during the year
under review. In addition, the Group’s shareholder’s equity turned positive at RM116.2 million for the financial year
ended 2023.

Total equity saw a turnaround at RM116.2 million (2022: RM(259.2) million) after the Group posted net profit in
the first quarter of 2023 which consequently turned negative shareholders’ equity positive, and further fortified
by RM50 million additional capital via share placement that was concluded in June 2023.

Total assets increased to RM3.1 billion (2022: RM2.5 billion) due to a higher security deposit paid as the Group
added four aircraft on operating lease into its fleet in 2023, in addition to higher prepayment in accordance with
operational requirements as the Group returned to normalised level of operations in 2023.

Total liabilities increased to RM3.0 billion (2022: RM2.7 billion) primarily driven by the increase in lease liabilities,
a direct result of the addition of aircraft on operating lease into the Group’s fleet in 2023.

Capital Structure and Capital Resources

In the FYE 2023, the cash flow generated from operations stood at RM(46.9) million (2022: RM108.9 million),
while no Group borrowing was recorded. For the period under review, the Group’s cash balance stood at RM57.7
million (2022: RM176.7 million).

Review of Operating Activities

The Group’s reportable operating segments consist of each company with an Air Operator’s Certificate (“AOC”)
held under the AirAsia X brand, namely Malaysia and Thailand. As of 31 December 2023, AirAsia X Malaysia
increased the number of aircraft to 18 aircraft within its fleet, with 16 activated and operational by the end of
the period. AirAsia X Thailand maintained its fleet of eight aircraft, with seven activated and operational as of
31 December 2023.

Segmental Performance Review

Revenue FYE 2023 FPE 2022
(‘000) (‘000)
Restated
Malaysia 2,527,096 825,860
Thailand 1,474,053 1,006,211
Indonesia - -
Elimination adjustment - -
Total 4,001,149 1,832,071

2023 Annual Report 19

CEO’S MANAGEMENT
DISCUSSION & ANALYSIS

EBITDA/LBITDA FYE 2023 FPE 2022

(‘000) (‘000)
Restated
Malaysia 663,362 33,545,770
Thailand 2,186,676 682,598
Indonesia - (92)
Elimination adjustment - -
Total 2,850,038 34,228,276

Profit Before Tax/Loss Before Tax FYE 2023 FPE 2022

(‘000) (‘000)
Restated
Malaysia 343,773 32,696,344
Thailand 2,093,601 482,078
Indonesia - (144)
Elimination adjustment - -
Total 2,437,374 33,178,278

Review of Corporate Exercises

In the preceding year’s Annual Report, I had the privilege of narrating the successful execution and completion of
key initiatives undertaken by the Group between 2021 to 2022, namely the Debt Restructuring, Share Consolidation
and Share Capital Reduction exercises. I had also shared an update on the Company’s progression with its
regularisation exercise which would include the submission of a Proposed Regularisation Plan to Bursa Malaysia
Securities Berhad to resolve its Practice Note 17 (“PN17”) status.

Following the financial quarter ended March 2023, during which the Group reported a turnaround of shareholders’
equity to RM40.8 million, we proceeded to submit a waiver application aimed at uplifting AirAsia X from its PN17
classification; this application was grounded on the fact that the Group no longer triggered any of the PN17
criteria. Subsequently, in November 2023, upon demonstrating the viability of the business through consecutive
quarters of profitability, the Group successfully emerged from the PN17 classification without the necessity of
submitting a regularisation plan.

At present, the Group is engaged in discussions with Capital A Berhad (“Capital A”) regarding the proposed
acquisition of the latter’s aviation business, encompassing airlines such as AirAsia Malaysia Berhad and AirAsia
Aviation Group Limited which in turn includes Thai AirAsia, Indonesia AirAsia and Philippines AirAsia. We look
forward to reporting to our shareholders and stakeholders the progress of the proposal from time to time, as
necessitated.

Outlook

Last year, I shared the Group’s undertaking to resume operations on a business-as-usual basis in June 2022. The
outcomes from our airline’s comeback had been remarkable, buoyed by the encouraging post-pandemic pent-up
demands from our markets. This resurgence had been nothing short of overwhelming, particularly as we were
operating only seven aircraft in 2022. At that juncture, the Group had pledged to reintroduce more of its aircraft
back into service, facilitating the relaunch of additional popular and profitable destinations, particularly into
China, our largest market before the onset of the pandemic in 2020. As earlier on outlined in this statement, this
commitment had been successfully realised.

20 AirAsia X Berhad
CEO’S MANAGEMENT
DISCUSSION & ANALYSIS

All through 2023, the Group’s key performance indicators have demonstrated promising trajectories. Operational
recovery had steadily edged close to pre-pandemic levels, even after the normalisation of pent-up demands amidst
the gradual return of capacity in the markets. By the end of December 2023, we have recorded 144 weekly flight
frequencies and today, we serviced 22 destinations across our network. Most recently, we launched our maiden
flight to Almaty, Kazakhstan, marking our venture into a new region, and with the removal of visa requirements
for travel between Malaysia and Thailand with China, we have observed a surge in demand for travel between
these markets, underpinned by over 90% PLF registered in the first quarter of 2024 for destinations in China.

Looking ahead to 2024, we eagerly anticipate the reintroduction of the final two aircraft into the Group’s active
and operational fleet by the first half of the year. Despite challenges posed by manpower and resource constraints
among our business partners and vendors, stemming from the longer-than-expected recovery period of supply
chain disruptions within the industry, the team remains determined to ensure the seamless reintegration of these
aircraft into the stream, prioritising the safety of our guests and crew above all else.

Next on the horizon, our fleet and network outlook remains promising, with new-specification aircraft that promises
longer range and enhanced cost efficiencies on order across the Group, such as the A330neo and A321XLR aircraft,
secured ahead of time on AirAsia X’s orderbook. This would allow us the avenue to explore a plethora of new
and exciting destinations that may not be as connected today, including routes to Europe, Africa and the United
States. The future is indeed bright, with endless opportunities for the Group.

Appreciation and Acknowledgements

On behalf of the AirAsia X Leadership Team, I extend our deepest appreciation to our Chairman, Dato’ Fam Lee Ee,
co-founders Tan Sri Tony Fernandes and Datuk Kamarudin Meranun, and all esteemed Board members. Their invaluable
guidance had been instrumental in steering the Company through its recovery journey, with ongoing undertakings
aimed at ensuring the sustained growth of AirAsia X.

A heartfelt appreciation goes out, as always, to our dedicated Allstars for their unwavering support and tireless
dedication to the Company. The value of “all for one, one for all” resonates deeply within our organisation,
highlighting the collective efforts towards our shared goals.

Last but certainly not least, I would like to take this opportunity to express my gratitude to all other esteemed
stakeholders for their continued support for AirAsia X; the past few years presented us with daunting challenges,
yet also imparted invaluable lessons to all of us, strengthening our resolve to drive AirAsia X’s business further
towards prosperity in the years to come.

Thank you.

Benyamin Ismail
Chief Executive Officer
AirAsia X Berhad

2023 Annual Report 21

SUSTAINABILITY
STATEMENT
CHAPTER 1:

OUR SUSTAINABILITY
APPROACH
23 About This Statement
23 Reporting Framework and Guidelines
23 Reporting Scope and Boundaries
24 Assurance
24 Feedback
24 We are AirAsia X
25 Sustainability Framework
25 Sustainability Achievements & Highlights in 2023
26 Sustainability Governance
27 Key Risks, Strategies & Outlook
29 Commitment to the UN Sustainable Development Goals
30 Stakeholder Engagement
30 Our Stakeholder Engagement Approach
32 Materiality Assessment

22 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

ABOUT THIS STATEMENT

AirAsia X Berhad (“AirAsia X” or “the Company”) presents its Sustainability Statement 2023, which showcases
its ongoing commitment to economic, environmental and social (“EES”) progress. This statement serves as a
comprehensive retrospective, charting the achievements and challenges that impact AirAsia X’s business operations
and stakeholders. To further solidify the Company’s sustainability commitment, we now introduce AirAsia X’s
Sustainability Framework, which provides a clear, actionable guide for the Company’s sustainable endeavours.

This year, we are pleased to announce a comprehensive revamp of our Sustainability Statement. We have expanded
our focus to include deeper insights in highly material topics, such as climate strategy, safety, employee empowerment,
and data privacy and security. Additionally, we have also enhanced the transparency of our EES data performance in
accordance with Bursa Malaysia Securities Berhad Main Market Listing Requirements (“Main LR”).

This Statement provides tangible evidence of our progress and shows how we manage risks and opportunities
across the sustainability spectrum. From operating responsibly to promoting diversity, equity and inclusion, we
strive to leave a positive footprint in the Asean region and beyond.

REPORTING FRAMEWORK AND GUIDELINES

[GRI 1, 2-1, 2-3]

This Statement was developed based on the Amendments to Main Market Listing Requirements (“MMLR”) of
Bursa Malaysia Securities Berhad in relation to Sustainability Statements within Annual Reports, with guidance
from Bursa Malaysia’s Sustainability Reporting Guide (“3rd Edition”). We have also prepared this Statement
with reference to the Global Reporting Initiative (“GRI”) Standards. Other frameworks and guidelines taken into
consideration include:

• ask Force on Climate-related Financial Disclosures (“TCFD”)

T
• United Nations’ Sustainable Development Goals (“UN SDGs”)
• FTSE4Good Bursa Malaysia (“F4GBM”) Index

REPORTING SCOPE AND BOUNDARIES

[GRI 2-2, 2-3]

This Statement covers the reporting period of 1 January 2023 to 31 December 2023, unless stated otherwise.
This Statement also provides comparative historical data wherever relevant and available. To ensure our
disclosures are comparable and meaningful, we have adjusted the reporting periods of 2021 and 2022 to each a
12-month period, effectively spanning from January to December for each respective year. This differs from the
financial period of 18 months for the 2021 and 2022 financial statements.

This Statement encompasses the activities of AirAsia X only, excluding any associates or joint ventures.
We have excluded Thai AirAsia X (“TAAX”) and PT. Indonesia AirAsia Extra (“IAAX”) because we do not
have direct management control over the former, while the latter has ceased operating as a result of the
pandemic. References to ‘AirAsia X’, ‘the Company’, ‘the Organisation’ and ‘we’ refer to AirAsia X Berhad and
its subsidiaries. For certain environmental indicators, the data reported would refer to operations in our head
corporate office (RedQ, Selangor) only, due to data limitation and exclude all hubs/stations, as well as any
subsidiaries.

While our EES reporting process is still in its initial phases, we are committed to invest resources and effort to
progress in a phased manner, aiming to enhance our sustainability reporting to a more comprehensive level.

2023 Annual Report 23

SUSTAINABILITY
STATEMENT

ASSURANCE
[GRI 2-5]

As part of the Company’s continuous effort to strengthen the credibility of the Sustainability Statement, data for
the following selected Subject Matters which are disclosed in the Sustainability Statement for the financial year
ended 31 December 2023 (“FYE 2023”) have been verified by the Company’s Internal Audit Department using
sampling approach and has been approved by the Company’s Audit Committee.

Subject Matter Common Indicators 2023 Data

i) Total energy consumption 13.1 million GJ
Emissions & ii) Scope 1 emission in tonnes of CO2e 960,280 tCO2e
Climate-related Strategy iii) Scope 2 emission in tonnes of CO2e 206 tCO2e
iv) Scope 3 emission in tonnes of CO2e 200,795 tCO2e
i) Number of work-related fatalities Nil
ii) Lost time incident rate 1.01
Health & Safety
iii) Number of employees trained on health & safety 1,236
standards
Number of substantiated complaints concerning Nil
Data Privacy & Security breaches of customer privacy and losses over customer
data

The scope of the review is based on the Company’s reporting scope and boundaries set by the Management as
disclosed in the Sustainability Statement for FYE 2023.

This Statement has also been reviewed by our Sustainability Steering Committee (“SSC”) and Risk Management
Committee (“RMC”), as well as endorsed by the Board of Directors (“the Board”) of AirAsia X.

FEEDBACK
[GRI 2-3]

In order to continuously improve our reporting and sustainability efforts, we welcome all feedback, ideas and
comments from our stakeholders. Please direct enquiries, feedback or comments on AirAsia X’s Sustainability
Statement 2023 via the following email: aax_sustainability@airasia.com.

WE ARE AIRASIA X
Established in 2006 as Fly Asian Express, AirAsia X is today a mid-range low-cost airline operating primarily in
the Asia-Pacific region. Following the successful completion of the Company’s debt restructuring exercise in
March 2022, we have embarked on a steady course of post-pandemic recovery, progressively expanding our
network which, as of 31 December 2023, encompasses 22 destinations from the initial Seoul and Delhi in April
2022. In addition, AirAsia X is pleased to announce the upliftment of its PN17 classification in November 2023,
following its fifth consecutive quarterly net profit.

An overview of AirAsia X’s operational statistics as of 31 December 2023:

No. of Passenger Load Available Seat Revenue No. of Fleet Size
Passengers Factor Kilometres Passenger Destinations
Carried (“ASK”) Kilometres
[million] (“RPK”)
[million]
2,822,605 80% 15,604 12,222 22 18 A330-300

24 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

SUSTAINABILITY FRAMEWORK
[GRI 2-6, 2-22]

The year 2023 marked a significant turning point in AirAsia X’s commitment to our economic, environmental and
social progress. We successfully conducted our inaugural materiality assessment, culminating in the launch of
AirAsia X’s first Sustainability Framework, which aligns with the Company’s identified material matters. Drawing
on the international GRI Standards 2021, our Sustainability Framework is structured around three core pillars:
economic, environmental, and social (“EES”). This comprehensive approach ensures that our sustainability
efforts address a wide range of critical aspects.

In previous years, we have progressively laid down our sustainability foundations by strengthening our safety
initiatives and continuously improving our operational efficiency. As the Company gains deeper understanding of
how to optimally align its business objectives with the global sustainability agenda, the Sustainability Framework
will be updated and refined consistently to ensure its continued relevance and efficacy.

VISION
To be the leading sustainable low-cost airline in Asia by
connecting underserved communities and championing eco-friendly
air travel across ASEAN and beyond

MISSION
Embracing innovative technologies and eco-efficient operations to minimise our environmental footprint in the pursuit of
net-zero emissions by 2050, whilst creating exceptional value for our customers

ECONOMIC (E)
Delivering exceptional value to our
ENVIRONMENTAL (E)
Driving eco-efficient operations
SOCIAL (S)
Cultivating a diverse and inclusive
customers by embracing technology and and minimising waste to reduce our workforce, ensuring the safety and
maintaining high standards of ethical environmental footprint well-being of our people, and actively
business conduct and risk management engaging the communities we impact

• Customer Service
AIRASIA X’s FOCUS AREAS
• Emission & Climate-related Strategy • Labour Practices, Standards &
• Corporate Governance • Waste Management Diversity
• Data Privacy & Security • Health & Safety
• Supply Chain Management • Community Empowerment

In alignment to United Nations Sustainable Development Goals (“SDG”)

SUSTAINABILITY ACHIEVEMENTS & HIGHLIGHTS IN 2023

EES Pillars Indicators 2023

Economic On-Time Performance 77% (s20% from 2022)
Carbon intensity (gCO2/ASK) 61.3 (t32% from 2022)
Environmental
Carbon intensity (gCO2/RPK) 78.3 (t34% from 2022)
Lost Time Incident rate 1.01 (t95% from 2022)
Social
Percentage of women in the workforce 48% (s4% from 2022)

2023 Annual Report 25

SUSTAINABILITY
STATEMENT

SUSTAINABILITY GOVERNANCE
[GRI 2-9, 2-10, 2-11, 2-12, 2-13, 2-14, 2-18]

At AirAsia X, sustainability is woven into the fabric of our governance structure, ensuring that we remain
accountable to meet our sustainability commitments. This starts at the top, with the Board holding the overall
responsibility for AirAsia X’s sustainability strategy and performance. At the same time, the RMC provides
Board-level oversight on AirAsia X’s direction, policies, and practices on both sustainability and risk management
matters. The Terms of Reference for the RMC was updated in May 2023 to incorporate the RMC’s roles and
responsibilities pertaining to sustainability-related matters, whilst also mandating the committee to convene on
a quarterly basis to review AirAsia X’s sustainability strategies and progress on sustainability-related initiatives,
including the sustainability statement.

In 2023, we established two vital committees to drive our sustainability journey. The SSC, led by the Chief
Executive Officer (“CEO”) and composed of the Leadership Team, charts our sustainability strategy and key
priorities. Meanwhile, the Sustainability Working Group (“SWG”) translates these into action, by implementing
sustainability initiatives across the organisation.

The specific roles and responsibilities of each committee are clearly defined as shown below, ensuring smooth
collaboration and effective navigation of tasks. This governance structure guarantees that sustainability remains
a top priority at every level.

Board of Directors

Risk Management Committee

Sustainability Steering Committee

Sustainability Working Group

Roles Responsibilities
• E nsures that the strategic plan of the Company supports long-term
value creation and includes strategies on economic, environmental
and social considerations underpinning sustainability; and
• Oversees the development and implementation of the Sustainability
Framework, strategies, priorities and targets.
Board of Directors
• P rovides oversight and assess the Company’s sustainability strategies,
policies, principles and practices, aligning it to the commitment of the
Company towards sustainability; and
• Review and advise on the Sustainability Statement prior to reporting
to the Board of Directors.
Risk Management Committee
• S ets the sustainability strategies, policies, principles and practices in
line with the Company’s direction; and
• Acts as a decision-making body for sustainability initiatives, including
recommending to the RMC for approval of the Sustainability
Statement.
Sustainability Steering Committee

26 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Roles Responsibilities
• Implements the sustainability strategies and initiatives set by the SSC;
and
• Prepares the Sustainability Statement by ensuring the quality and
extent of disclosures.

Sustainability Working Group

During the reporting year, the SWG, SSC and RMC convened to discuss the following matters:
• Sustainability initiatives;
• Sustainability reporting & data collection;
• Approval of materiality assessment findings; and
• Finalisation of AirAsia X’s Sustainability Framework.

KEY RISKS, STRATEGIES & OUTLOOK

[GRI 3-3]

With international travel taking off once more, the Board and Management of AirAsia X are reaffirming their
commitment to a robust risk culture. To maintain operational resilience, we have identified our key risks as well as
the associated mitigation strategies, based on AirAsia X’s nine material matters. This proactive approach allows
us to prioritise mitigation efforts and navigate potential challenges with agility.

Pillars Material Topics Risks Strategies & Outlook

Corporate Non-compliance of regulations By maintaining robust governance practices,
Governance imposed by regulatory bodies we enhance trust and transparency across
(including but not limited to stakeholders within the Company.
Malaysian Aviation Commission
(“MAVCOM”) and Bursa Read more in Chapter 4: Delivering Economic
Economic Malaysia). Value via Robust Governance

Customer Inability to meet customer Ongoing enhancements are implemented

Service expectations may adversely based on Net Promoter Score (“NPS”) surveys
affect loyalty and result in distributed to passengers following their
reduced revenue. experience with AirAsia X flights.

2023 Annual Report 27

SUSTAINABILITY
STATEMENT

Pillars Material Topics Risks Strategies & Outlook

Emissions & Our international flight Adopting in-sector measures such as
Climate-related operations expose us to operational efficiency, new aircraft fleet
Strategy non-compliance risks from and SAF would reduce our environmental
evolving climate regulations footprint significantly, in addition to potentially
and Sustainable Aviation Fuel reducing operational costs.
Environmental (“SAF”) mandates across our
markets. Read more in Chapter 2: Addressing Climate Change

Waste Non-compliance t o By leveraging pre-booked meal information

Management environmental regulations can and historical customer purchase data, we
lead to fines and sanctions. aim to minimise overall waste generation,
particularly food waste. We also continuously
engage with responsible, licensed contractors
to manage our scheduled waste.

COMMITMENT TO THE UN SUSTAINABLE DEVELOPMENT GOALS

Since the launch of the UN SDGs in 2015, we have recognised the importance of this global agenda throughout the
years. This year, we are primarily directing our focus towards eight SDGs, which are aligned to the sustainability
initiatives implemented in 2023.

SDG SDG Targets Our 2023 Progress

5.5 Eliminate all forms of violence against • 17% of our Board of Directors are women
women & girls, including trafficking & • aunched our inaugural gender pay gap
L
other types of exploitation analysis
• Organised a community programme with
5.5 Women’s full and effective participation Women’s Aid Organisation, which impacted
& equal opportunities for leadership at 18 beneficiaries
all levels
8.5 Achieve full & productive employment • Provided employment for 1,336 Allstars
and decent work for all • More than 396 Allstars participated in
#KnowTheSigns Human Trafficking awareness
8.7 Take effective measures to eradicate course
forced labour, end modern slavery & • Zero work-related fatalities
human trafficking

8.8 Protect labour rights & promote safe and

secure working environments for all
9.1 Develop quality, reliable, sustainable & • Implemented 5 fuel-saving initiatives
resilient infrastructure to support economic • Set to induct our first Airbus A330neo aircraft
development and human well-being, with by 2026; and the Airbus A321XLR by 2028
a focus on affordable & equitable access
for all

9.4 Upgrade infrastructure & retrofit to

make them sustainable, with increased
resource use efficiency and greater
adoption of clean & environmentally
sound technologies
11.2 Provide access to safe, affordable, • Safety Management System in place ensures
accessible & sustainable transport systems operational risks are proactively managed
to all with relevant procedures to prevent serious
incidents
11.5 Reduce the number of deaths & the
number of people affected, and decrease
the direct economic losses relative to
global gross domestic product caused
by natural disasters
12.2 Achieve sustainable management & • ocal suppliers constituted 34% of our supply
L
efficient use of natural resources chain expenditure
• Implemented 5 fuel-saving initiatives, which
12.7 Promote public procurement practices resulted in 1,708 tonnes of fuel saved
that are sustainable, in accordance with
national policies & priorities

2023 Annual Report 29

SUSTAINABILITY
STATEMENT

SDG SDG Targets Our 2023 Progress

13.2 Integrate climate change measures • Sustainable fleet management by ordering
into strategies & planning the latest aircraft type: Airbus A330neo and
A321XLR
13.3 Improve education & awareness-raising • Monitoring, Reporting and Verification (“MRV”)
on climate change mitigation, adaptation, of carbon emissions
impact reduction & early warning • Started tracking Scope 3 emissions
• Disclosed Scope 1, 2 and 3 emissions
16.5 Substantially reduce corruption and • Established Board oversight of sustainability
bribery in all forms through the RMC
• 1 00% new joiners acknowledged the
16.6 Develop effective, accountable and Anti-Bribery and Anti-Corruption Policy
transparent institutions at all levels • Zero incidents of corruption

16.7 Ensure responsive, inclusive, participatory

and representative decision-making at all
levels
17.16
Enhance the global partnership • Approximately 2,707 suppliers and vendor
f o r s u s t a i n a b l e d eve l o p m e n t , partners across the globe
complemented by multi stakeholder • Engagements with the International Civil
partnerships that mobilise and share Aviation Organization (“ICAO”) for Carbon
knowledge, expertise, technology and Offsetting and Reduction Scheme for
financial resources, to support the International Aviation (“CORSIA”) compliance
achievement of SDGs in all countries,
in particular developing countries

STAKEHOLDER ENGAGEMENT
[GRI 2-29, GRI 3-3]
OUR STAKEHOLDER ENGAGEMENT APPROACH

WE WE WE
LISTEN ENGAGE REPORT

30 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Building good relationships with our stakeholders is a constant priority. AirAsia X actively listens to their needs
and aspirations, as it shapes the very foundation of the Company’s operations. By maintaining an active and
multi-channel communication, we pave the way for long-term value creation for all.

Stakeholder Areas of Interest Metrics/Data Tracked Our Response

Groups
• Share price appreciation and an • R evenue, EBITDA • C EO’s Management
attractive dividend stream and other financial Discussion & Analysis,
• Sustainable growth in revenue and performance indicators pg 16-21
financial performance • S hare price and • Financial Statements,
• Attractive business plans and growth dividends pg 115-127
Investors strategy • R obust Corporate
• Strong and experienced management Governance, pg 72-77
• Transparent reporting and disclosure
• Sound ESG practices measured through
shareholder feedback and Annual
General Meeting (“AGM”) outcomes
• A safe and healthy work environment • Employee satisfaction • Safety as our Priority,
• air remuneration, effective
F survey pg 48-56
performance management and • T r a i n i n g and • Empowering Allstars, pg
recognition development indicators 57-63
• Career development and advancement • Employee retention and • E t h i c a l Business
Employees opportunities turnover rate Conduct, pg 73-74
(Allstars) • An empowering environment that • Safety indicators
embraces diversity and inclusivity
• Responsible and high-quality airline • Customer Satisfaction • O ur Sustainability
services Scores Approach, pg 22-24
• Affordable international flights • Net Promoter scores • P r i o r i t i s i n g G u e st
• Excellent customer service Satisfaction, pg 66-68
• Trusted and credible AirAsia X brand
Customers
(Guests)
• C ompliance with all legal and • C a r b o n e m i ss i o n • Safety as our Priority, pg
regulatory requirements indicators 48-56
• Active engagement with the industry • Safety audit reports • M a n a g i n g our
and regulatory working groups and certifications Environmental Footprint,
• Reduction of carbon emissions pg 44-46
Regulators/ • Ethical Business Conduct,
Governmental pg 73-74
Bodies
• C o m m u n i t y empowerment • Amount channelled • Safety as our Priority, pg
programmes towards community 48-56
• Mitigating our operational impact on empowerment • Towards Low-Carbon
the environment • Number of beneficiaries Operations, pg 36-44
positively impacted • M a n a g i n g our
Local Environmental Footprint,
communities pg 44-46
• S u p p o r t i n g our
Communities, pg 63-64

2023 Annual Report 31

SUSTAINABILITY
STATEMENT

Stakeholder Areas of Interest Metrics/Data Tracked Our Response

Groups
• air procurement and responsible •
F Percentage of local • Safety as our Priority,
sourcing practices suppliers engaged pg 48-56
• Supplier assessment and engagement • Quality of suppliers • S ustainable Supply
process engaged Chain, pg 77-78
• Contractor health and safety practices
Suppliers and
contractors
• usiness strategies and growth plans •
B Press releases • C EO’s Management
• Updates on routes and destinations Discussion & Analysis,
pg 16-21
• AirAsia X website
• Social Media
Media

MATERIALITY ASSESSMENT
[GRI 3-1, GRI 3-2, GRI 3-3]

In the third quarter of 2023, AirAsia X conducted its inaugural materiality survey, thus kickstarting our official
sustainability journey. Via this materiality assessment, the Company engaged with 416 respondents from eight
stakeholder groups, which enabled us to understand their expectations and key areas of interest. Since this is
the Company’s first materiality assessment, we adhere to the recommendations stipulated in Bursa Malaysia’s
Toolkit: Materiality Assessment (“3rd Edition”). The materiality process that was undertaken is outlined below:

Step 1: Step 2: Step 3:

Identification of Material Matters Prioritisation of Material Review and Validation of
Matters Process & Outcomes
We have identified nine material matters e sent a materiality survey
W The materiality matrix is then
that are relevant to our business and value to both internal and external approved by the following
chain, based on external and internal stakeholders to rate these nine committees:
sources. Our external sources include material matters based on • Board of Directors;
industry benchmarking, emerging trends their influence on stakeholder • Risk Management Committee;
in the aviation industry, as well as relevant decisions and significance on and
reporting standards and frameworks the Company’s EES impacts. • S ustainability Steering
such as Bursa Malaysia’s Sustainability Committee.
Reporting Guideline. Our internal sources esults of the assessment
R
include assessment of business context, were plotted in a materiality We aim to conduct a full-scale
key performance indicators and relevant matrix, graded from high to materiality assessment once
policies. very high importance. every two years, with a limited
scale review conducted in the
We also identified eight stakeholder intervening years.
groups that are pivotal to our value chain.

32 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Materiality Matrix:

Very High
Overall influence on Stakeholder Assessments and Decisions

Corporate Governance

Data Privacy & Security

Health & Safety
Customer Service

Supply Chain Management

Labour Practices, Standards & Diversity
Emissions & Climate-Related Strategy
Waste Management

Community Empowerment

High

High Very High

Significance of Company’s Economic, Environmental and Social Impacts

Based on the materiality assessment conducted, our findings revealed that all nine material topics are deemed
highly important by internal and external stakeholders alike. Therefore, the materiality matrix shown above is
highlighting the top-right quadrant when scaled from a rating of 1 to 5. In summary, the top 5 material topics that
are deemed most important by all stakeholders are as follows:
• Health & Safety
• Labour Practices, Standards & Diversity
• Data Privacy & Security
• Corporate Governance
• Emissions & Climate-Related Strategy

Henceforth, the disclosures on the 5 material topics above would be the main focus for this year’s Sustainability
Statement.

Note:
In line with Bursa Malaysia’s enhanced sustainability requirements under the Main Market Listing Requirements:
• “Anti-Corruption” is covered under Corporate Governance
• “Energy Management” is managed under Emissions & Climate-Related Strategy
• “Water” is managed under Waste Management
• “Diversity” is managed under Labour Practices, Standards & Diversity

2023 Annual Report 33

SUSTAINABILITY
STATEMENT

EES Pillars Material Topics Description

Customer Service Ensuring transparent and timely flight-related communications
and customer service

Corporate Governance Upholding high standards of good governance, integrity, policies

Economic and standard procedures to build transparency within AirAsia X

Data Privacy & Security Protecting our customer’s data and ensuring data security while
booking flights through AirAsia’s website

Supply Chain Supporting sustainable procurement practices while ensuring

Management suppliers and vendors meet our ESG standards

Emissions & Climate- Proactively managing our emissions and climate-related risks,
Related Strategy including carbon emissions and energy consumption

Waste Management Responsibly managing waste, particularly food waste and

Environmental scheduled waste (i.e., operational and maintenance-related waste)

Labour Practices, Upholding labour practices and standards, as well as promoting

Standards & Diversity a workplace culture that advocates diversity & inclusion, training,
development and talent retention.

Social Health & Safety Promoting flight and workplace safety, as well as the well-being
of employees.

Community Supporting our community programmes, including employee

Empowerment volunteering activities

34 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

CHAPTER 2:

ADDRESSING CLIMATE
CHANGE
36 Towards Low-Carbon Operations
36 2023 Performance Overview
37 Low-Carbon Transition Strategies
40 GHG Emissions Management
44 Aircraft Noise Management
44 Managing our Environmental Footprint
44 2023 Performance Overview
45 Waste Management
46 Water Management

2023 Annual Report 35

SUSTAINABILITY
STATEMENT

TOWARDS LOW-CARBON OPERATIONS

2023 PERFORMANCE OVERVIEW
[GRI 3-3]

AirAsia X remains committed to addressing the impact of climate change and is working towards aligning
ourselves with ICAO’s Long Term Aspirational Goal to achieve net zero emissions by 2050. We have outlined
four aviation pathways towards this end, namely, operational efficiency, new aircraft technologies, sustainable
aviation fuel; as well as market-based measures including carbon offsetting.

Following the opening of Malaysia’s border to international travel in April 2022, AirAsia X has seen a sharp
increase in passenger traffic, effectively lowering our carbon footprint per passenger. This trend continued in
2023, whereby AirAsia X gradually resumed flights; and grew our fleet to 18 aircraft by the end of the year in
anticipation of the increased load factor.

AirAsia X presents the environmental disclosures below to outline our achievements and way forward by building
resilience against climate-related risks whilst meeting our customer’s expectations as an environmentally-responsible
airline.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• AirAsia X Sustainability Policy Total energy consumption
• ICAO requirements 13.1 million GJ
• CORSIA requirements, including
the Emissions Monitoring Plan Carbon intensity per RPK
• Environmental Policy Statement 78.3 gCO2/RPK
• Environmental Quality Act 1974
Carbon intensity per ASK
61.3 gCO2/ASK

Total GHG emissions

(Scope 1+2+3)*
1,161,281 tCO2e

CO2 emissions avoided through

the fuel efficiency programme
5,395 tCO2e

*Scope 3 emissions only cover categories 3, 6 and 7.

36 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

LOW-CARBON TRANSITION STRATEGIES

[GRI 305-5]

As global efforts to combat climate change intensified in 2023, two significant developments emerged, presenting
both opportunities and challenges for airlines such as AirAsia X.

Global Climate-Related Developments Local Climate-Related Developments

In November 2023, the Third ICAO Conference on Malaysia’s National Energy Transition Roadmap was
Aviation and Alternative Fuels (“CAAF/3”) established published in August 2023. This policy document
a collective ambition to reduce CO2 emissions in outlined a plan to introduce a SAF blending mandate
international aviation by 5% by 2030 via the utilisation starting at 1% and gradually increasing to 47% by
of cleaner aviation fuels. This aligns with the outcome 2050. While this development represents progress
of the 28th United Nations Climate Change Conference towards national climate commitments, the roadmap
(“COP28”), held a month later, which approved a acknowledges hurdles in identifying suitable feedstock
roadmap for a just and orderly transition away from that meets sustainability criteria and lacks a concrete
fossil fuels. These global agreements place additional implementation start date.
pressure on the aviation industry to adopt alternative
fuel solutions such as SAF to achieve long-term
net-zero goals.

In response to the developments above, we have continued making progress in our low-carbon transition plan in
2023, via the four main strategies outlined below:

Strategy 1: Operational Efficiency Strategy 2: Aircraft Technologies

• trengthening and maintaining our industry-leading •
S Meeting the latest ICAO emissions and noise standards;
fuel efficiency programme and
• Induction of the Airbus A330neo and A321XLR
aircraft by 2026 and 2028, respectively.
Strategy 3: Sustainable Aviation Fuel (SAF) Strategy 4: Carbon Offsetting
• Exploring opportunities for the utilisation of SAF • Introducing carbon offsetting into AirAsia X’s
operations; and
• Exploring CORSIA-certified carbon projects in Asean.

2023 Annual Report 37

SUSTAINABILITY
STATEMENT

Strategy 1: Operational Eco-Efficiency

Long standing to the Company’s commitment to minimise carbon emissions from its source, AirAsia X maintains
an industry-leading fuel efficiency program as the most immediate solution to minimise our carbon footprint.
This has allowed AirAsia X to maintain an industry-leading carbon intensity, all whilst lowering our operational
costs.

In 2023, AirAsia X implemented a number of fuel efficiency initiatives, including measures which contribute
to the lifespan extension of our aircraft engines. The reduction in engine wear and tear allows the engines
to work more efficiently, leading to fuel savings in the long run. Additionally, the implementation of the fuel
efficiency initiatives also has a direct impact on our carbon intensity per ASK, which is a key metric of overall
flight efficiency.

Below are the highlights of AirAsia X’s fuel efficiency initiatives in 2023.

Flight 2023 Initiatives Description Fuel Saved Total CO2

Stage (tonnes) avoided (tCO2)
Take-Off One Engine Taxi on Procedure to operate one engine 647 2,044
Departure instead of two during aircraft taxi-
out from the gate to the runway.
Take-Off Pressurisation Air Procedure which turns off the air 39 123
Conditioning Kits conditioning system during takeoff.
(“PACKs”) OFF Take-
Off
Landing One Engine Taxi on Procedure to operate one engine 572 1,806
Arrival instead of two during aircraft
taxi-into the arrival gate.
Landing Idle Reverse Landing Procedure that uses idle thrust (instead 287 908
of full reverse engine thrust) upon
touchdown to reduce noise and fuel
burn.
Landing Reduced F l a p s Procedure that uses reduced flap 163 514
Landing configuration (CONF3) during landing
to reduce aerodynamic drag and fuel
burn.
Total 1,708 5,395

Through the green operating initiatives above, AirAsia X has avoided 5,395 tonnes of CO2 into the atmosphere,
or equivalent to 89,916 trees planted. Moving forward in 2024, AirAsia X will expand the monitoring and tracking
of additional green operating procedures, to further strengthen our flight efficiency, and minimise emissions
from the onset.

5,395
Tonnes of CO2 emissions
avoided
equivalent to
89,916
trees planted

For more information on Greenhouse Gases Equivalencies, please visit

https://www.epa.gov/energy/greenhouse-gases-equivalencies-calculator-calculations-and-references

38 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Strategy 2: Aircraft Technologies

AirAsia X seeks to maximise our fleet efficiency by investing in the latest aircraft technologies for the betterment
of our environment. As of 31 December 2023, AirAsia X maintains a fleet of 18 Airbus A330-300 with an average
fleet age of 12.1 years, of which two aircraft remain in storage. In 2024, AirAsia X’s key focus is to ensure all 18
aircraft are activated and operational, and will continue to align its fleet expansion plan with network requirements.

Model Units Average Age of Aircraft (years) Passenger Capacity

Airbus A330-300 18 12.1 285/309/367/377

Regarding our future sustainable fleet development, AirAsia X is set to induct our first Airbus A330neo aircraft
by 2026; and the Airbus A321XLR by 2028. The A330neo comes with a new wing and sharklet design which
optimises aerodynamics; and together with the new Rolls-Royce Trent 7000 engine with new efficiency
technologies, the A330neo is the first aircraft to be certified to ICAO’s latest CO2 emissions standard, which we
expect to offer much improved fuel burn per passenger compared to the existing A330-300 series, as well as up
to 20% reduction in NOx emissions below the ICAO CAEP*/8 standards.

For more information on the Airbus A330neo aircraft, please visit

https://www.airbus.com/en/products-services/commercial-aircraft/wide-body-aircraft/new-efficient-engines-sustaining-the

The A321XLR, on the other hand, with its range of 4,700 nautical miles (11 hours), allows AirAsia X to expand our
long haul expertise to new destinations. Built upon the platform of the efficient Airbus A321neo and combined
with its extended range capabilities, the A321XLR allows AirAsia X to manage our capacity requirements for
some of our existing destinations; while expanding our reach to new destinations.

For more information on the Airbus A321XLR aircraft, please visit

https://aircraft.airbus.com/en/aircraft/a320/a321xlr

These new aircraft will contribute significantly in allowing eco-conscious passengers to travel responsibly to new
destinations. Moving forward, AirAsia X will also continue to pursue efficient aircraft technologies, to minimise
the scope 1 emissions from its source.

Strategy 3: Sustainable Aviation Fuel (“SAF”)

The aviation industry has long been considered as a “hard-to-abate” sector. In particular, existing battery
storage technologies limit the immediate viability of alternative propulsion technologies such as zero-emissions
or hybrid aircraft for medium- to long-haul operations. Hence, SAF remains as the dominant method for
medium- to long-haul airlines to meet their net zero emissions targets. Depending on the production pathway, SAF
can reduce the life cycle CO2 emissions by up to 80% when compared to conventional jet fuels. This reduction in CO2
emissions will directly impact our scope 3 emissions from the extraction and refinery of fuels (Scope 3 category 3); as
well as our carbon intensity.

Currently, seven biofuel production pathways are certified to produce SAF, which perform at operationally
equivalent levels to conventional jet fuels. This is also known as drop-in fuel, which can be directly blended into
existing fuel infrastructure at airports and is fully compatible with our Airbus A330-300 fleet and the upcoming
A330neo aircraft, with up to 50% blend of SAF.

The main obstacle for a wide SAF adoption for AirAsia X remains the high price of SAF, at up to 3 times the price
compared to Jet A1, as well as the limited production capacity and capability. Nonetheless, AirAsia X is keeping
abreast of ongoing developments of SAF mandates by the destinations that we currently fly to.

* Committee for Aviation Environmental Protection

2023 Annual Report 39

SUSTAINABILITY
STATEMENT

Strategy 4: Carbon offsetting

Malaysia has participated in the CORSIA scheme since its inception in 2016, which is implemented to achieve
carbon neutrality for all international flights between the contracting states. Under this scheme, any “excess”
emissions above the baseline shall be offset, either through the purchase of CORSIA-eligible carbon credits; or
CORSIA-eligible fuels in the form of SAF or low carbon aviation fuel (“LCAF”).

While the CORSIA offsetting regime began in 2021, the temporary halt in international travel globally has caused
carbon emissions to fall below the 2019 baseline. To ensure CORSIA’s objectives are met, the 41st ICAO General
Assembly in October 2022 has decided to lower the baseline to 85% of 2019 levels, from 2024 onwards. With
international traffic recovering and major countries such as China and India joining CORSIA’s second phase in
2027, AirAsia X anticipates a significant increase in the required offsetting volume. In 2023, we began identifying
high-quality CORSIA-eligible offsetting projects in the regions to which we fly. In 2024, we plan to introduce a
new carbon fee to supplement AirAsia X fares. Structured to have minimal impact on airfares, the fee will be
earmarked for decarbonisation purposes. As of writing this report, our fee proposal is being evaluated by civil
aviation authorities in AirAsia X’s operating countries for implementation from 2024 onwards.

CORSIA Implementation Phases & Years

First
PHA
ASE 2024 SE
PH 23 -2
026
20
ot
Pil
1-

Sec 7-2035

3 PHASES
202

ond P
202

of Implementation
HASE

Note: Participation of States in the pilot phase (2021 to 2023) and first phase (2024 to 2026) is voluntary.

GREENHOUSE GAS (“GHG”) EMISSIONS MANAGEMENT

GHG Emissions Accounting

For our GHG inventory, we follow the approach and guidance as defined by the Greenhouse Gas Protocol. Our
Scope 1 emissions are attributed to the fuel consumption from our airline operations. For scope 2 emissions and
category 7 of our scope 3 emissions, our data only covers operations in Kuala Lumpur. Moving forward, we aim
to improve the completeness of our carbon emissions inventory by expanding the assessment boundary.

SCOPE 1
Direct GHG emissions by reporting
SCOPE 2
Indirect GHG emissions from
SCOPE 3
Indirect GHG emissions from
company imported energy by reporting upstream and downstream activities
company
fuel and energy-related
activities
fuel consumption of aircraft purchased electricity
business travel

960,280 tCO2e Emissions employee commuting

206 tCO2e

Emissions
200,795 tCO2e

Total Scope 1 + 2 + 3 emissions = 1,161,281 tCO2e

40 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Scope 1 GHG Emissions

[GRI 305-1, 305-4]

Fuel Consumption 2021 2022 2023

Fuel burn (tonnes) 40,453 58,948 302,832
Fuel use intensity (litres/100 RPK) 733.4 2
4.8 3.2

Scope 1 Carbon Emissions & Intensity 2021 2022 2023

Scope 1 emissions (tCO2e) 1
128,276 186,924 960,280
Carbon intensity per RPK (gCO2/RPK) 18,192.5 2
118.1 78.3
Carbon intensity per ASK (gCO2/ASK) 6,735.2 2
89.9 61.3

Notes:
1
The data reported here includes the CO2 equivalents of methane (CH4) and nitrous oxide (N2O) emissions. AirAsia does not emit
hydrofluorocarbons, perfluorocarbons or sulphur hexafluoride from flight operations.
2
In 2021, AirAsia X predominantly operated cargo flights, with minimal passenger flights, hence the large difference in magnitude for the
intensity figures when compared to 2022 and 2023.

With the continuous resumption of scheduled flight operations in 2023, AirAsia X has observed a five-time
increase in fuel consumption from 58,948 tonnes to 302,832 tonnes. To understand the context of this figure,
AirAsia X analysed the carbon footprint of each passenger and flight in the form of carbon intensity per RPK
and ASK. This normalised figure provides a basis for comparison of our carbon footprint over the years. In 2021,
AirAsia X predominantly operated cargo flights, with minimal passenger flights, hence the large difference in
magnitude for the intensity figures when compared to 2022 and 2023.

We observed that the carbon intensity has seen a healthy 34% decrease to 78.3 gCO2 /RPK in FYE 2023
from 118.1 gCO2 /RPK in FPE 2022, owing to the higher load factors in 2023. The carbon intensity per ASK,
which measures the overall flight efficiency, has also seen a decreasing trend to 61.3 gCO2 /ASK from 89.9
gCO2 /ASK, owing to longer average flight times as our network was rebuilt. AirAsia X expects the carbon
intensity to normalise and converge towards pre-pandemic levels, until the commencement of the use of
SAF and the induction of new generation aircraft such as the A330neo and the A321XLR.

As AirAsia X is subjected to all the Monitoring, Reporting and Verification requirements of CORSIA, we have
engaged an accredited verification body to audit and verify our CO2 emissions from all international flights
annually since 2019. This provides a layer of assurance as AirAsia X predominantly operates international flights.
At the time of writing of this report, AirAsia X is in the midst of verifying our carbon emissions for international
flights for 2023 with the accredited verification body.

Energy Management
[GRI 302-1]

The increase of non-renewable fuel consumption from 2022 to 2023 by approximately a factor of five is mainly
due to increased flight activities in 2023. The management of non-renewable fuel consumed is stated in our
Scope 1 emissions disclosure, whilst the management of non-renewable electricity purchased is stated in our
Scope 2 emissions disclosure.

Categories 2021 2022 2023

Non-renewable fuel consumed (MJ) 1
1,749,187,720 2,548,911,520 13,094,455,680
Non-renewable electricity purchased (MJ) 369,683 467,903 977,793
Total Energy Consumption (MJ) 1,749,557,403 2,549,379,423 13,095,433,473

Note:
1
he energy content of non-renewable fuel purchased (Jet-A1 fuel for our aircraft) is based on the Fuel Lower Heating Value (“FLHV”) or
T
18,590btu/lb, or 43,240MJ/tonnes of Jet A1 consumed.

2023 Annual Report 41

SUSTAINABILITY
STATEMENT

Scope 2 GHG Emissions

[GRI 302-1, 305-2]

Non-renewable electricity purchased (MWh) Scope 2 Emissions (tCO2e)

2023 271.6 2023 205.9

2022 130.0 2022 98.5
2021 102.7 2021 77.8

As AirAsia X’s head office is based in RedQ, we have conducted an estimation of AirAsia X’s electricity consumption
based on the proportion of leased office space at RedQ. In 2023, RedQ registered a 109% increase in electricity
consumption compared to the previous year, primarily due to all employees returning to work in the office.

Electricity Consumption2 2021 2022 2023

Total electricity consumption (MWh) 102.7 130.0 271.6

Scope 2 Emissions & Intensity2 2021 2022 2023

Scope 2 emissions (tCO2e) 1
77.8 98.5 205.9
Scope 2 intensity (tCO2e /m2) 0.12 0.15 0.32

Notes:
1
The Grid Emissions Factor used is 0.758 tCO2e /MWh, which is extracted from the Malaysian Energy Commission database (2021 Peninsular).
2
The data reported here only encompasses AirAsia X’s operations in our head corporate office (RedQ, Selangor) and excludes all hubs/
stations and AirAsia X’s subsidiaries, due to data limitations.
3
The Scope 2 Guidance, published by GHG Protocol, is used as the methodology to calculate Scope 2 emissions.

The RedQ Facilities Department has implemented various initiatives in our offices aimed at enhancing energy
efficiency and reducing our overall resource consumption. These initiatives encompass:
• Conversion to LED lighting at the office
• Scheduled energy usage following working hours
• Staggered switching for major equipment such as air conditioning

Scope 3 GHG Emissions

[GRI 302-2, 305-3, 305-4]

AirAsia X has commenced tracking of our scope 3 emissions, which enables us to understand the impact of
the emissions beyond our value chain. As the aviation industry utilises jet fuel as our primary source of energy,
more than 99% of our scope 3 emissions originates from the extraction and refinery of jet fuel, also known as
the well-to-tank (“WTT”) emissions. The utilisation of SAF will be one method to reduce our Scope 3 emissions.
With existing production pathways focused on bio-based origins, SAF can be safely and easily integrated into
existing aircraft and fuelling infrastructure with up to 50% blend, and will potentially reduce the lifecycle carbon
emissions by up to 80% when compared to conventional jet fuel.

We encourage the organisation of online meetings and conferences where possible to reduce the need for business
travel. For employee commuting, we raise awareness via Workplace to encourage employees to reduce their carbon
footprint by carpooling with colleagues or taking public transportation to their respective workplaces.

AirAsia X will also continue to work closely with our business partners to track and minimise our scope 3 carbon
emissions, and will include additional scope 3 emissions categories as deemed applicable for the reporting year.

42 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Scope 3 Emissions Category Carbon emissions in 2023 (tCO2e)

3 - Fuel- and Energy-Related Activities not included in scope 1 or 200,413
scope 21,2
6 - Business travel3 68
7 - Employee commuting 4
314
Total 200,795

Notes:
1
The Technical Guidance for Calculating Scope 3 Emissions, published by GHG Protocol, is used as the methodology to calculate Scope 3
emissions; and emission factors are sourced from UK Government GHG Conversion Factors for Company Reporting, version 1.1 year 2023.
2
Category 3 emissions originate from jet fuel production from our airlines operations.
3
Employee business travel data only covers air travel (flights) operated by external airlines, due to data limitations.
4
Employee commute data only covers employees that travel by car and are parking at our head corporate office (RedQ, Selangor), due to
data limitations.

Other GHG Emissions

[GRI 305-7]

We recognise that apart from the greenhouse gases, other air pollutants such as nitrogen oxides (“NOx”), sulphur
oxides (“SOx”) and Volatile Organic Compounds (“VOC”) emitted from the combustion of jet fuel will have an
impact on the air quality surrounding the airport. In recognition of this, all of AirAsia X’s A330-300 aircraft
currently in operation are compliant with the most stringent ICAO CAEP/8 NOx emissions standards.

Pollutants 2021 2022 2023

NOx emissions (tonnes) 1
67 80 349
NOx emissions intensity (gNOx/RPK)1 9.463 0.05 0.03
SOx emissions (tonnes) 2
1.52 1.83 7.98
VOC emissions (kg) 2
5,255 6,336 27,600

Notes:
1
NOx emissions and compliance data are obtained from the ICAO Emissions Data Bank Issue 29B, dated 20 June 2023.
2
SO2 and VOC emissions data are sources from US Environmental Protection Agency’s Generic Aircraft Type Emission Factors Table; under
the category Aircraft/Commercial. SO2 represents the highest composition of SOx emissions per US EPA standards, hence SO2 is considered
as SOx for the purpose of calculations.
3
In 2021, AirAsia X predominantly operated cargo flights, with minimal passenger flights, hence the large difference in magnitude for the
intensity figures when compared to 2022 and 2023.

100%
COMPLIANT WITH ICAO ANNEX CAEP/8 NOx
EMISSIONS STANDARDS

2023 Annual Report 43

SUSTAINABILITY
STATEMENT

Aircraft Noise Management

All of AirAsia X’s A330-300 (engine type A330-343) currently in operation are also compliant with the latest
ICAO Annex 16 Chapter 14 noise standards. Moving forward, the A330neo aircraft will be fully certified under
these new noise standards, which offers a 16EPNdB noise reduction compared to the older ICAO Chapter 4
noise standards; or a 9EPNdB reduction compared to the latest ICAO Chapter 14 noise standards. In addition,
AirAsia X also complies with all relevant noise abatement procedures when operating at destinations with noise
restrictions and curfews, minimising the impact and disruptions to the local communities.

100%
COMPLIANT WITH ICAO ANNEX 16 CHAPTER 14
NOISE STANDARDS
MANAGING OUR ENVIRONMENTAL FOOTPRINT
2023 PERFORMANCE OVERVIEW
[GRI 3-3]

We strive to manage our environmental footprint by responsibly managing our waste and water consumption.
Efficient and well-planned waste and water management is essential to avoid unnecessary resource consumption
and environmental issues.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• AirAsia X Sustainability Policy Total solid hazardous waste
• nvironmental Policy Statement
E generated
• Environmental Quality Act 1974 2.29 tonnes

Total liquid hazardous waste

generated
3,790 litres

Total non-hazardous waste generated

24.7 tonnes

Total water consumption

1,304 m3

44 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

WASTE MANAGEMENT
[GRI 3-3, 306-1, 306-2, 306-3, 306-4, 306-5]

Waste generated by AirAsia X can be broadly categorised into two types, namely hazardous and non-hazardous
waste. Engineering waste is considered to be hazardous, whereas food waste is considered non-hazardous.
Through actively adopting the practices of elimination, reduction, reuse and recycling, we aim to continuously
reduce the disposal of waste to landfills.

In 2023, no sanctions nor any non-compliance was recorded in relation to environmental regulations or requirements.

Hazardous Waste
Hazardous waste is harmful to human health and the environment, and therefore should be disposed of properly.
The main source of hazardous waste for AirAsia X comes from the scheduled waste from engineering and
maintenance activities conducted at our main hub in Kuala Lumpur. We engage with licensed contractors to
dispose of spent fluids and parts, in compliance with the Environmental Quality (Scheduled Wastes) Regulations
2005 in Malaysia.

In 2023, AirAsia X generated 2.29 tonnes of solid waste; and 3.79 kilo litres of liquid waste. The increase in the
scheduled waste generated in 2023 is due to the increased engineering activities focused on fleet activation.

Hazardous Waste 2021 2022 2023

Total Waste Generated
• Solid waste (tonnes) 3.71 1.49 2.29
• Liquid waste (kilo litres) 1.72 2.29 3.79
Waste Diverted from Disposal (tonnes) 0 0 0
Waste Directed to Disposal
• Solid waste (tonnes) 3.71 1.49 2.29
• Liquid waste (kilo litres) 1.72 2.29 3.79

Non-Hazardous Waste
While the main source of non-hazardous waste is generated from the cabin activities onboard our flights,
AirAsia X does not collect, store or dispose of any of the waste generated from our aircraft’s galley, as they are
collected and processed by the contractors contracted by the airport authority at our main hub in Kuala Lumpur.
Nonetheless, AirAsia X has commenced tracking of our food waste data beginning in 2023 to understand the
impact of our cabin activities to the environment.

AirAsia X has worked closely with SANTAN, our catering provider, and has set the food waste target to 30% of
the total consumption onboard. Leveraging on multiple initiatives to optimise the catering uplift onboard our
flights, AirAsia X has generated 24.7 tonnes of food waste in 2023, or a 14.8% wastage compared to the total
consumption. Below are the initiatives that AirAsia X has undertaken with SANTAN to minimise our food waste
onboard our flights.

Initiatives Description
Predictive loading SANTAN utilises the dashboard to capture wastage
report for all flights in order to optimise the catering
uplift
Pre-booked meals Passengers are encouraged to pre-book their meal
prior to their flights, to ensure their meal of choice is
served, which also allows for more efficient catering
uplift for the flight
Catering forecast based on historical data SANTAN leverages historical sales data based on
destination and nationality, which enables more
accurate catering forecast to optimise catering uplift

2023 Annual Report 45

SUSTAINABILITY
STATEMENT

Non-Hazardous Waste 2023

Total Waste Generated (tonnes) 24.7
Waste Diverted from Disposal (tonnes) 0
Waste Directed to Disposal (tonnes) 24.7

WATER MANAGEMENT
[GRI 303-1, 303-5]

As AirAsia X’s head office is based in RedQ, we have conducted an estimation of AirAsia X’s water consumption
based on the proportion of leased office space at RedQ. The water supply for our main office, RedQ, is from
municipal potable water sources.

Water Consumption 2021 2022 2023

Total water consumption (m ) 3 1
896 1,877 1,304

Note:
1
The data reported here only encompasses AirAsia X’s operations in our head corporate office (RedQ, Selangor) and
excludes all stations/hubs and AirAsia X’s subsidiaries due to data limitations.

For further enhancement, AirAsia X will establish a water management policy and will expand our reporting scope
to include water consumption in other parts of our operations, including flight operations and in-flight usage.

46 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

CHAPTER 3:

CARING FOR OUR PEOPLE

& COMMUNITIES
48 Safety as Our Priority
48 2023 Performance Overview
49 Ensuring Robust Safety Governance
51 Driving Operational Safety Performance
54 Embedding a Safety-First Culture
55 Safety Assurance, Certifications & Awards
56 Empowering Allstars
56 2023 Performance Overview
57 Promoting Diversity, Equity and Inclusion
60 Championing Allstars
63 Supporting Our Communities
63 2023 Performance Overview
63 Our Community Empowerment

2023 Annual Report 47

SUSTAINABILITY
STATEMENT

SAFETY AS OUR PRIORITY

2023 PERFORMANCE OVERVIEW
[GRI 3-3]

At AirAsia X, ensuring safe flights goes beyond a mere checklist; it stands as a fundamental priority in all aspects
of our operations. The Company’s primary focus is on the safety of everyone we impact, especially our dedicated
Allstars crew and each valued passenger on board. We implement effective governance systems and continually
enhance our procedures and processes to guarantee a seamless, comfortable, and, most importantly, stress-free
journey for our passengers. Furthermore, we recognise the crucial role each Allstar plays in safeguarding our
operations, emphasising the belief that a robust safety culture is a shared responsibility amongst all employees.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• Safety Policy Statement Number of work-related fatalities
• Safety Management System for employees
(“SMS”) Manual 0
• Flight Data Analysis (“FDA”)
Manual Lost Time Incident rate
• Alcohol & Drug Management 1.01
Programme
• Emergency Response Manual Total safety training hours
• International Air Transport 3,090
Association (“IATA”) Operational
Safety Audits (“IOSA”) Number of safety reports filed
• Occupational Safety, Health & 1,310
Environment (“OSHE”) Manual
• I S O 9 0 01 : 2 01 5 Q u a l i t y Percentage of reported hazards,
Management System incidents and accidents, which have
• ISO 45001:2018 Occupational been investigated and addressed
Health & Safety 100%

48 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

ENSURING ROBUST SAFETY GOVERNANCE

[GRI 403-1, 403-7, 403-8]

AirAsia X’s dedication to achieving operational excellence is grounded in our unwavering commitment to
safety. The foundation of this commitment lies in our robust SMS, characterised by dedicated structures, clear
responsibilities, and rigorous processes, all aimed at cultivating a safe environment for all stakeholders. This
framework hinges on two pivotal functions: Safety Risk Management and Safety Assurance.

Through Safety Risk Management, we proactively identify potential hazards and implement effective controls
to minimise the associated risks. Following that, Safety Assurance would diligently monitor the effectiveness of
these controls and update them as the operational landscape evolves. Each step in this process reinforces our
commitment to providing the safest possible experience for everyone who flies with us.

Safety Management System (SMS) Manual

Safety Policy & Objectives Safety Risk Management
• Management Commitments • Hazard Identification
• Safety Accountability & Responsibilities • Safety Risk Assessment and Mitigation
• Appointment of Key Safety Personnel
• Coordination of Emergency Response Planning
• SMS Documentation
Safety Assurance Safety Promotion
• Safety Performance Monitoring and Measurement • Training and Education
• Management of Change • Safety Communication
• Continuous Improvement

Safety Governance & Accountabilities

[GRI 403-1, 403-7, 403-8]

At AirAsia X, we foster a safety culture that values trust and accountability, with clearly outlined roles and
responsibilities. Safety excellence is a shared goal at every level of our organisation, whereby leaders play a
crucial role in shaping the mindset of Allstars on safety.

Safety Governance
Safety Review Provides strategic guidance and
Board direction on safety-related policies
SAFETY CHIEF
REVIEW EXECUTIVE and resource allocation.
BOARD OFFICER
Oversees safety performance
and trends to ensure effective
management of safety risks.
CORPORATE Corporate Safety Oversees the implementation
SAFETY Department and continual enhancement of
DEPARTMENT
the SMS, thus ensuring regulatory
compliance and operational safety
excellence.
FUNCTIONAL
DEPARTMENT Monitors the safety performance of
WITH
AIRASIA X service delivery units and provides
dedicated support to line managers
on safety matters.
Safety Action Composed of line managers
SAFETY Groups and representatives from each
ACTION department who drive the
GROUP
implementation of safety initiatives
across the organisation.

2023 Annual Report 49

SUSTAINABILITY
STATEMENT

Hazard Identification & Safety Risk Management

[GRI 403-1, 403-2, 403-3, 403-4, 403-8]

In championing a proactive safety culture within the organisation, we meticulously analyse hazards, especially
during in-flight operations, to identify and mitigate existing and potential safety risks. The implementation of
thorough risk assessments guides the development and implementation of effective controls across all facets of
our operations, thus ensuring continuous safety improvement.

STEP 1 STEP 2 STEP 3 STEP 4

HAZARD RISK MITIGATION & RISK DOCUMENTATION RISK COMMUNICATION
IDENTIFICATION & IMPLEMENTATION & REVIEW We disseminate adopted
mitigating strategies to
RISK ASSESSMENT We formulate controls
and mitigation strategies
All hazard and risk
assessments are archived
relevant stakeholders via
We systematically channels such as safety
to address identified in our Safety Library.
i d e n t i f y p o te n t i a l reports, safety bulletins,
hazards.
hazards, encompassing as well as seminars and
We regularly conduct
both natural elements workshops.
S u b s e q u e n t l y, reviews to evaluate
(eg: thunderstorms) and
responsibilities for the the sufficiency of
technical factors (eg:
implementation of these risk management
aircraft component
mitigation strategies are measures and verify
failures) by employing
assigned to relevant the effectiveness of
reactive, proactive,
departments within the implemented controls.
and predictive
organisation.
methodologies.

S u b s e q u e n t l y, a
comprehensive risk
assessment is conducted
to evaluate the likelihood
and severity of
potential consequences
associated with these
hazards.

50 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

DRIVING OPERATIONAL SAFETY PERFORMANCE

[GRI 403-1, 403-7, 403-8, 403-9]

Our Corporate Safety Department consistently oversees the health and safety performance at AirAsia X,
regularly presenting key indicators to senior management on a monthly basis. In 2023, AirAsia X reported zero
work-related fatalities, one Lost Time injury, and a Lost Time Incident Rate (“LTIR”) of 1.01. Notably, our 2023 LTIR
reflects a 94% reduction compared to the previous year.

The table below summarises our safety performance in 2023:

2021 2022 2023

Total man-hours worked 1,613,744 1,603,888 2,377,936
Number of work-related 0 0 0
fatalities
Fatality rate 0 0 0
Number of recordable 0 3 1
work-related injuries
(number of incidents)
Rate of recordable 0 0.37 0.08
work-related injuries
Lost time Injury 0 161 12
(number of lost workdays
due to injuries)
Lost Time Incident Rate 0 20.08 1.01
Number of employees 388 766 1,236
participating in
safety-related trainings

Notes:
• Fatality rate = Number of work-related fatalities/total man-hours worked x 200,000
• Rate of recordable work-related injuries = Number of recordable work-related injuries/total man-hours worked x 200,000
• Lost Time Incident Rate = Total number of lost time injuries/total man-hours worked x 200,000

2023 Annual Report 51

SUSTAINABILITY
STATEMENT

Flight Safety & Security

[GRI 403-1, 403-2, 403-4]

From takeoff to touchdown, safety underpins every aspect of AirAsia X’s operations. State-of-the-art safety
dashboards, meticulous maintenance procedures, and thorough aircraft inspections are some of the measures
that we undertake to ensure flight safety. Multiple departments play a role in upholding the highest safety
standards at AirAsia X, including flight safety, ground safety, engineering safety and cabin safety. Below is a brief
explanation of the comprehensive safety procedures undertaken to safeguard our customers and Allstars:

Flight Safety Safety risk assessments A safety reporting system Our Flight Data Analysis
are carried out by all is in place for the pilots monitoring dashboard
departments prior and cabin crew to report monitors our flight safety
to operating to new any threats, incidents and performance. Analyses are
destinations as a preventive occurrences during the carried out as required and
measure by ensuring all flight. Flights are constantly safety bulletins/circulars are
risk levels are as low as m o n i to re d a n d a ny published as part of safety
reasonably practicable. anomalies will be relayed promotion.
to the Operations Control
Centre (“OCC”) for further
action.
Ground Safety Our Ground crew are Emergency response Our Ground Crew guides
extensively trained in teams are on standby at the aircraft safely to its
safe baggage handling both departure and arrival designated parking bay.
and passenger boarding airports, ready to act if Baggage is unloaded and
procedures. needed. delivered efficiently while
maintaining passenger
safety.
Engineering Safety Our Engineering team All flights are continuously Our Engineering
conducts thorough m o n i to re d a n d a ny personnel conduct post-
inspection and maintenance anomalies will be relayed to flight inspections and/or
as required to ensure the OCC. The Maintenance maintenance as required
airworthiness of the aircraft. Operations Control team is before the next flight.
available 24/7 to remotely
assist the pilots if any
technical issues arise.
Cabin Safety Cabin conditions are Our Cabin crew conducts The cabin is thoroughly
checked before flights to regular cabin checks, cleaned and disinfected,
ensure their airworthiness ensuring passenger preparing it for the next
and functionality. safety and comfort. They flight.
are trained to handle
in-flight emergencies,
from medical situations to
turbulence.

52 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Flight Crew Health & Well-Being

[GRI 403-6]

At AirAsia X, we understand that safeguarding the mental well-being of our Allstars, particularly pilots and cabin
crew, is essential for preventing fatigue, stress, and substance-use issues within our operations. Henceforth,
comprehensive controls and processes have been incorporated into AirAsia X’s SMS to proactively identify and
manage these potential risks. By prioritising the mental well-being of our team, we ensure that they are better
equipped to handle challenging situations and ultimately enhance the safety of every flight.

Fatigue Risk Alcohol & Drug Allstar Peer Support Physical Well-Being
Management Management Programme Programme
All AirAsia X crew shall In 2022, we launched To improve the mental well- Allstars are provided with
attend the training for our alcohol and drug being of our employees, we an in-house clinic and a
efficient handling of stress management programme established the Allstar Peer physiotherapy lab in RedQ,
and fatigue, as required by to prevent any illegal Support programme – a to ensure that they receive
regulators. use of these intoxicating confidential space where quick treatments in case of
s u b s t a n c e s by o u r employees, especially those illness or physical injuries.
AirAsia X also strictly employees. This programme facing stressful or traumatic
adheres to established consists of three events, can find comfort
maximum Flight Duty components: reporting from trained colleagues.
Periods and Minimum Rest and testing; medical
Periods to ensure pilots intervention, rehabilitation In addition, our pilots and
receive sufficient time off and peer support; as well cabin crew also have access
to rest and recuperate. as continuous education. to the health and wellness
app, Naluri.
This year, 66 AirAsia X crew
have been tested via this
programme. In 2024, we
plan to increase the testing
rate by conducting this
programme on a monthly
basis, instead of quarterly.

2023 Annual Report 53

SUSTAINABILITY
STATEMENT

EMBEDDING A SAFETY-FIRST CULTURE

[GRI 403-4, 403-5, 403-6]

At AirAsia X, our foremost priority is nurturing a fair and just safety culture within the workplace. This entails
striking a balance between holding individuals accountable for their actions, acknowledging that mistakes can
happen, and recognising the importance of learning from these mistakes to enhance overall safety. This culture
actively promotes open communication, continuous learning, and proactive measures in preventing accidents.
Ultimately, safety is the shared responsibility of all Allstars.

Safety Training
AirAsia X ensures that safety is continuously top-of-mind for all our employees. Thus, we provide sufficient and
necessary aviation safety-related training to all Allstars, to ensure that they are continuously updated with safety
systems and procedures, thus ensuring effective responses when needed.

In 2023, 1,236 Allstars attended a total of 3,090 hours of safety training conducted by our Corporate Safety
department, compared to 766 Allstars with a total of 1,915 hours in 2022. The increase in training hours is in line with
cultivating a positive safety culture within the organisation, as well as the resumption of operations post-pandemic.
The table below showcases the different types of trainings that our employees participated in 2023:

Safety Management System Safety Induction Training Ergonomic Awareness Training

The safety management system is a This training is conducted to welcome This training is conducted to educate
systematic approach to managing new employees to the company and our employees on the risk factors for
safety in aviation including the to educate all employees on potential musculoskeletal disorders, and how
necessary organisational structures, hazards as well as safe work practices ergonomics can make their work
accountabilities, policies and in their workplace or work tasks. easier, more efficient and safer.
procedures. This training is conducted
to ensure that relevant personnel are
trained and competent to perform
their responsibilities towards safety.

Safety Promotion
In addition to safety training, our commitment to continuous safety promotion includes activities such as
ergonomics risk assessments, a month-long safety campaign, newsletter topics covering occupational safety
and health matters, fire evacuation drills, return-to-work programmes in collaboration with PERKESO and other
safety-related measures.

Allstars Safety Campaign Emergency Fire Evacuation Drill

“Safer Together, Stronger Together”
In 2023, we collaborated on a month-long safety AirAsia X prioritises preparedness through biennial
campaign with the motto “Safer together, Stronger emergency fire drills, fostering a safe and responsive
together”, which signifies the importance of teamwork work environment. Our most recent drill on 15 December
and prioritising safety above all. Approximately all 2022, engaged all AirAsia X employees based in RedQ.
AirAsia X Allstars, excluding cabin crew and pilots on Held in collaboration with Airport Fire Rescue Service
duty, took part in the Safety Day activities designed (“AFRS”) KLIA, Fire and Rescue Department KLIA, and
to create safety awareness. We also held various Malaysia Red Crescent Ambulance, this comprehensive
competitions for Allstars to share their creativity and exercise served to evaluate the functionality of the
safety knowledge, such as a safety reels contest and a fire system, educate employees regarding emergency
safety posters contest. procedures, as well as measure the speed of building
evacuation.

Safety survey Safety newsletter Safety notices Flight Safety notices

for all AirAsia X Allstars in to all AirAsia X Allstars to all AirAsia X Allstars, to all AirAsia X pilots, as
November 2023 on a quarterly basis as and when required and when required

54 AirAsia X Berhad
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SAFETY ASSURANCE, CERTIFICATIONS & AWARDS

[GRI 403-1]

At AirAsia X, we implement a robust safety assurance system comprising three key pillars: performance
monitoring, management of change and continuous improvements.

Performance Monitoring
AirAsia X prioritises robust safety standards across all our operations. We undergo regular, independent audits by
independent third-party verifiers, who assess our processes for reliability and transparency, and ensure we meet
the highest safety benchmarks. We adhere to the rigorous IOSA standards, considered the gold standard in airline
safety globally. Additionally, we follow the Malaysian Civil Aviation Regulations (“MCAR”) and CAAM Civil Aviation
Directives (“CAD”), which are national regulations for safe and efficient aviation practices. These comprehensive
assessments ensure continuous improvement, ultimately making our operations safer and more secure.

In 2023, AirAsia X carried out a total of 15 safety-related audits throughout the year, with the majority
conducted by CAAM. Other internal audits were carried out by the Operational Quality Assurance department,
which includes the joint station compliance audit (“JSCA”) as well as the internal operations audit (“IOA”), as
per regulatory requirements, IOSA standards and industry best practices.

7 CAAM AUDITS
5 JSCA AUDITS
In recognition of our efforts to enhance health and safety measures, we also received the following certifications
and awards:

IOSA Certification by IATA 7 Stars Safety Rating by Airline Ratings

The IOSA, conducted every two years, rigorously AirAsia X was named among the top 20 safest
assesses airlines against eight key operational low-cost airlines by AirlineRatings.com, an
principles: international airline safety ranking organisation.
• Organization and Management System; Factors used to decide the top 20 safest low-cost
• Flight Operations; airlines include incident records, fleet age, results
• Operational Control and Flight Dispatch; of audits conducted by the governing body of
• Aircraft Engineering and Maintenance; aviation, ICAO, as well as European Union banned
• Cabin Operations; lists.
• Ground Handling Operations;
• Cargo Operations; and AirAsia X received a 7-star rating for the second
• Security Management. consecutive year, which is the highest number of
stars awarded, thus underscoring our collective
AirAsia X has consistently achieved IOSA efforts towards safety.
certification since its initial audit in 2013,
demonstrating a long-standing commitment to
exceeding global safety standards.

The last IOSA renewal audit was carried out from

5 to 8 December 2022. This audit certificate is valid
until 11 April 2025.

2023 Annual Report 55

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Following independent audits, AirAsia X diligently addresses identified non-conformities. Employing a root
cause analysis approach, we implement corrective and preventive actions as necessary. Upon their successful
evaluation, these non-conformity reports are officially closed. Moreover, common audit findings are distributed
to relevant stakeholders through regular forums and auditor training sessions, fostering collective learning and
risk mitigation.

Management of Change
AirAsia X acknowledges the potential impact of internal and external changes on safety. Therefore, a formal
change management process is triggered for new technologies, equipment, operating environments, key
personnel, regulatory requirements, and staffing levels, among others. Notably, 13 Management of Change and
239 risk assessments were conducted by operational departments in 2023, underscoring our commitment to
proactive risk management.

Continuous Improvement
To guarantee the enduring effectiveness of AirAsia X’s SMS, we employ dedicated safety assurance activities
and internal audit processes. Additionally, as part of our continuous improvement efforts, a comprehensive SMS
effectiveness evaluation is conducted at least annually.

EMPOWERING ALLSTARS
2023 PERFORMANCE OVERVIEW
[GRI 2-7, 3-3]

Here at AirAsia X, we recognise that our enduring success is fueled by the passion and dedication of our people.
Prioritising top-tier talent, we continuously invest in our Allstars’ personal and professional growth in order to
create a motivated and thriving workplace. Ultimately, a robust workforce is key towards realising our ambitions
of becoming a resilient and purpose-driven organisation.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• Anti-Bribery and Anti-Corruption Average training hours per
Policy employee
• Code of Business Conduct; 14.45
• Employee Handbook
• Anti-Harassment Policy Women in the workforce
• Remuneration Policy 48%
• Board Diversity Policy
• Learning and Development Women representation in Board
Policy of Directors
17%

Number of substantiated complaints

concerning human rights violations
3

56 AirAsia X Berhad
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PROMOTING DIVERSITY, EQUITY AND INCLUSION

[GRI 405-1, 405-2]

From our Asean roots to our global reach, AirAsia X thrives on a diverse team of Allstars. We hire and promote
based on merit and potential, fostering an inclusive culture where everyone feels valued and respected,
regardless of their background. This diverse tapestry of perspectives and opinions fuels our growth and success,
therefore enhancing our understanding of customers, facilitating informed decision-making, and promoting
safe and effective operations. Consequently, our recruitment diversity guidelines are designed to provide equal
employment opportunities for all our hires.

Workforce Diversity
In 2023, our workforce consisted of 1,336 employees, with 52% men and 48% women. During the year under
review, our foremost priority is to rehire the Allstars who were unfortunately affected during the hibernation
period, and ensure that all recurrent training and qualifications were achieved accordingly.

The majority of our employees are full-time permanent employees, constituting approximately 72% of the Company’s
workforce. Following that, approximately 28% of our workforce are full-time contract employees, primarily comprising
of our cabin crew, who are expatriates. Cabin crew contract employees undergo performance-based renewal after
one year of service.

The summary of our workforce diversity is provided below:

2023 WORKFORCE DIVERSITY

WORKFORCE BY WORKFORCE BY WORKFORCE BY
GENDER AGE EMPLOYMENT CATEGORY
Leadership 63% 37%
Female Below Above Team
48.0% 30 years 50 years 78% 22%
29.8% 6.5% Management

72% 28%
Manager

50% 50%
Executive

72% 28%
Non-Executive

30-50
Male years
52.0% 63.7%
Male Female

2023 Annual Report 57

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ADVANCING
WOMEN
IN LEADERSHIP*
Board of 83% 17% For the past three years, we have witnessed encouraging growth
Directors in the representation of women across various levels, including
63% 37% board of directors, managerial and non-executive positions.
Leadership
Team
22%
In 2023, women comprised 17% of our Board of Directors, 37%
78%
Management of our Leadership Team, and 22% of our management team.
This significant representation means that one-fourth of the
Company’s key decision-makers are women. Moving forward,
Male Female we remain committed to identifying and supporting a strong
pipeline of women advancing into leadership roles.

*Leadership is defined as those within the Board of Directors and

Leadership Team, as well as those holding Management positions

Gender Pay Gap

Recognising the impact of systemic bias, AirAsia X seeks to address gender pay discrepancies within our
organisation. In 2023, we conducted an in-depth analysis of our eight job grades, aligned with UK regulations,
to identify and rectify any pay gaps due to gender. This is the first step that we are undertaking to pave the
way for a more equitable and inclusive workplace, especially since the aviation industry is widely known as
being male-dominated. Both charts below showcase our 2023 findings in terms of the gender pay gap across
all employment categories.

Based on our analysis, we acknowledge that there is a gender pay gap within the organisation, with the
average mean and median hourly pay of male AirAsia X Allstars being recorded as 15.5% and 15.7% higher
than that of their female counterparts, respectively. This reflects the historical underrepresentation of women
in technical roles such as pilots, engineers, and IT professionals.

While our pay structure itself is gender-neutral, with clear diversity recruitment guidelines, we found that the
gap emerged due to women often choosing non-technical roles, which is mostly influenced by the challenges
of balancing work and family responsibilities.

Therefore, AirAsia X is committed to bridging this gap in our hiring process. Beginning in 2023, all hiring
managers will undergo comprehensive unconscious bias training. This initiative aims to equip our hiring
managers with the knowledge and tools to identify and overcome personal biases, resulting in more objective
and equitable interview practices. Through practical tips, case studies, and industry best practices, AirAsia X
is committed to fostering a diverse and welcoming talent pool.

AVERAGE OF MEDIAN PAY GAP AVERAGE OF MEAN PAY GAP

15.7% 15.5%
58 AirAsia X Berhad
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Leadership Leadership
Team 22.4% Team 22.5%

Management 5.3% Management 6.4%

Median Pay Gap

Mean Pay Gap

Manager 25.3% Manager 28.1%

Executive 22.1% Executive 19.4%

Non-Executive 3.5% Non-Executive 1.0%

Notes:
• The mean gender pay gap represents the variance in the average hourly wages of female employees compared to their male counterparts.
• The median pay gap signifies the difference in hourly compensation between the woman positioned in the middle of a line-up of all female
employees according to how much they are paid and the man similarly situated in the line-up of all male employees.
• A positive percentage indicates female employees are paid less than male employees, while a negative percentage indicates the opposite.

Upholding Human Rights

We have always placed great importance on creating employment opportunities that value and respect human
rights. We have established an Anti-Harassment Policy to prevent and mitigate any forms of harassment, promote
a safe and conducive working environment, educate Allstars to recognise that harassment is a demeaning
practice and encourage Allstars to report all incidents of harassment. The responsibility to respect human rights
is embedded into our Code of Conduct and Ethics for our Allstars. In 2023, we recorded 3 cases of human rights
violation concerning harassment as per the table below:

Year No. of Case Action Taken

2021 0 -
2022 0 -
2023 3 All three cases have been resolved according to the company’s Anti-Harassment
Policy, with only one resulting in dismissal action, while the other two received
warnings.

The complaint procedure is outlined in the Anti-Harassment Policy, and the investigation will be conducted
immediately, with confidentiality and discretion, as quickly as possible. Allstars who are alleged to have
committed or are believed to have committed harassing conduct shall be put under investigation and be subject
to a disciplinary process. We strongly advocate against any sexual harassment and misconduct cases in the
workplace, and we actively educate our employees on this issue via our Anti-Harassment Policy training on
Workday.

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CHAMPIONING ALLSTARS
At AirAsia X, we believe in supporting our Allstars every step of the way. From the initial recruitment stage to
fostering their continuous engagement and development, we are highly committed to nurturing our talent at
every phase of their journey.

Employee Upskilling
[GRI 404-1, 404-2]

At AirAsia X, we empower our Allstars to chart their own course towards success, both professionally and
personally. We fuel their journey with ongoing learning and upskilling programmes, equipping them with the
functional and technical skills they need to navigate the future of work. To cater to diverse learning styles, we
engage with airasia academy to offer a blend of face-to-face, virtual, and blended training programmes.

19,305
Hours of training provided to
AirAsia X employees in 2023
14.45
Average training hours per
AirAsia X employee in 2023
100%
AirAsia X employees
participating in Workday
training courses in 2023

2023 KEY TRAININGS

ANTI-TRAFFICKING ANTI-HARASSMENT INFORMATION
TRAINING POLICY TRAINING SECURITY
- #KNOW THE SIGNS AWARENESS EDUCATION

ANTI-BRIBERY AND PILOT SAFETY

BUILDING EMERGENCY ANTI-CORRUPTION & EMERGENCY
EVACUATION DRILL TRAINING PROCEDURE
RECURRENT TRAINING

PILOT SIMULATOR CABIN CREW

TRAINING RECURRENT TRAINING

60 AirAsia X Berhad
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Training and Development

In 2023, we significantly increased
our training hours as compared to
the previous year, primarily due

Averahe training hours per Allstar

to the resumption of operations
following the Company’s operational
Senior
hibernation. Management 0.33

While 2022 focused on mandatory Management 0.61

physical training for pilots and
cabin crew, 2023 saw a surge in Manager 14.45
training opportunities across the
board. We provided 19,305 hours
of training, encompassing everyone
from pilots and cabin crew to RedQ
office staff. This comprehensive
approach ensures all Allstars are
equipped with the latest skills and
knowledge to excel in their roles.

In addition to the trainings that we provide on Workday, we also provide several leadership development
opportunities for our Allstars, which are detailed below:

Command Leadership e-Programme Leading People On Demand Learning Series

Introduced in February 2023, this 3-month leadership The 90-day Leading People programme aims to equip
programme aims to equip First Officers with soft skills newly promoted Allstars with leadership essentials
and emotional intelligence, fostering future Captains such as strategic thinking, mentoring and high-perfor-
who excel technically and lead empathetically. The mance management.
modules in this programme focus on leadership,
mental resilience and conflict resolution, amongst
others. In this year alone, 30 AirAsia X First Officers
have graduated from this programme, ready to guide
teams and elevate our customers’ flying experience.

Employee Engagement
Our commitment to a positive workplace has always meant prioritising open and transparent exchange of ideas
between Allstars. We believe that this practice would inculcate a sense of belonging, thereby boosting employee
satisfaction and productivity. In 2023, we jointly organised the Allstar Feedback Survey 2023. The results shown
were quite positive, as AirAsia X registered a Net Promoter Score of 30. However, areas for improvement include
enhancing the well-being of Allstars, as well as valuing their opinions and ideas.

2023 Annual Report 61

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Employee Benefits
[GRI 401-2]

We aim to be the employer of choice by offering a competitive remuneration package which prioritises the well-
being and development of Allstars.

CAREER FINANCIAL
UPSKILLING ADVANCEMENT
We assist Allstars in
HEALTH
We offer a variety of We provide financial education
development programmes recognising and utilising their
on debt management,
and training courses via airasia strengths to discover fresh
personal financial planning,
academy. career possibilities using our
and legacy planning via
internal talent marketplace,
relevant service providers
which is facilitated by an
(eg: Naluri).
intuitive AI system.

MEDICAL & LIFE FAMILY WELL-

TRAVEL BEING
BENEFITS BENEFITS
We provide medical, life and
We offer maternity leave
(98 days), paternity leave
We offer employee travel
personal accident insurance, (8 days), marriage leave
benefits to which they
as well as an in-house clinic, a (5 days), a creche and mother’s
can extend to their family
physiotherapy clinic and room, and provide medical and
members.
in-house counselling services. bereavement support through
Red Heart Fund.

Employee Appraisals
[GRI 404-3]

In 2022, the Company introduced the Objectives and Key Results (“OKR”) framework into the performance
management and appraisals for Allstars. This simple goal-setting approach boosts alignment, engagement, and
clarity, driving us towards achieving our business plan. Via this approach, quarterly reviews with line managers are
conducted to ensure consistent progress and ongoing goal adjustments. In 2023, 100% of AirAsia X employees
were appraised.

Employee Turnover
[GRI 401-1]

The Company’s employee turnover for 2023 is summarised as follows. We experienced a turnover rate of
approximately 3% for the year, a manageable figure.

Category Number of Employee Turnover

Leadership Team 2
Management 6
Manager 5
Executive 30
Non-Executive 0
Total employee turnover 43
Total employee turnover rate 3.2%

62 AirAsia X Berhad
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SUPPORTING OUR COMMUNITIES

2023 PERFORMANCE OVERVIEW
[GRI 3-3, 413-1]

AirAsia X is committed to making a positive impact on the communities where we operate in. By leveraging our
business as a force for good, our goal is to create meaningful change in people’s lives via impactful initiatives. In
2023, our primary focus is on business recovery post-pandemic, alongside our commitment to actively contribute
to our communities. While our contributions may have been minimal during the year, we have plans for additional
activities to support our communities in 2024. To further strengthen our community engagement efforts, we
have recently expanded our focus to include specific initiatives targeting gender equality.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• AirAsia X Sustainability Policy Total community investment
RM 2,190

Total number of beneficiaries

impacted
18

Total employee volunteers

OUR COMMUNITY EMPOWERMENT

In line with our enhanced commitment towards community empowerment in 2023, we invested RM2,190 in
the Women’s Aid Organisation (“WAO”). This initiative involves our Allstars based in our head corporate office
(RedQ, Selangor).

2023 Annual Report 63

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WOMEN’S AID ORGANISATION

AirAsia X actively participated in the restoration of WAO’s Safe Space, a sanctuary for survivors of domestic
violence. Via our manpower involvement and monetary contribution, we ensured that survivors now have
access to comfortable seating, practical storage solutions, and functional spaces within the shelter.

Via this initiative, AirAsia X supported WAO in establishing an environment where survivors can reclaim
their sense of dignity, setting the stage for a fresh start on their journey toward empowerment. This initiative
reflects our commitment to community and solidarity, embodying our dedication to making a meaningful
and positive impact on the lives of those we serve.

64 AirAsia X Berhad
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CHAPTER 4:

DELIVERING
ECONOMIC VALUE VIA
GOOD GOVERNANCE
66 Enhancing Guest Experience
66 2023 Performance Overview
66 Prioritising Guest Satisfaction
69 Driving Technology, Innovation and Data Privacy
69 2023 Performance Overview
70 Technology & Innovation
70 Cybersecurity & Data Privacy
72 Robust Corporate Governance
72 2023 Performance Overview
72 Ethical Business Conduct
74 Risk Management
76 Sustainable Supply Chain
76 2023 Performance Overview
77 Sustainable Procurement

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ENHANCING GUEST EXPERIENCE

2023 PERFORMANCE OVERVIEW
[GRI 2-29, 3-3]

At AirAsia X, we prioritise guest service excellence at every touchpoint, from pre-flight planning to in-flight
enjoyment and beyond. Safety remains our top priority, however, comfort is also a must for all our guests.
Leveraging insights from our affiliate travel and lifestyle app, airasia MOVE, we seek to personalise our guests’
travel journey and deliver experiences that offer remarkable value for their investment.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• ISO 10002-2018 Customer On-Time Performance
Satisfaction and Complaints 77%
Management
• AirAsia X Complaints Handling Passenger Load Factor
Policy Statement 80%

Net Promoter Score

Customer Satisfaction Score

70%

PRIORITISING GUEST SATISFACTION

As part of our digital transformation journey, AirAsia X collaborated with our affiliates to develop a suite of
innovative solutions to enhance our guests’ travel journey. A cornerstone of this approach is the convenient
self-check-in functionality within airasia MOVE, effectively eliminating queueing hassles for our valued guests.
Furthermore, we started implementing the FACES biometric facial recognition technology in 2021, thus
revolutionising the check-in experience via contactless processes such as baggage drop, identity verification,
and pre-security clearance. This technology enhances guest comfort and efficiency, marking a significant leap
forward in our commitment to exceptional travel experiences.

On-Time Performance (“OTP”)

Recognising the crucial role that OTP plays in guest satisfaction, we implemented strategic initiatives that
propelled our OTP to 77% in 2023, a significant increase from 57% in 2022. This achievement can be attributed
to several factors below:
• Relaxed COVID-19 restrictions at our destinations resulted in fewer delays at the airports; and
• Expanding our fleet provided greater flexibility in managing aircraft rotations, thus minimising the impact of
potential delays and preventing them from cascading.

66 AirAsia X Berhad
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Furthermore, our passenger load factor exhibited a positive trajectory, rising from 78% in 2022 to 80% in 2023.
This encouraging trend demonstrates our progress towards regaining pre-pandemic level performance and
reaffirms our commitment to delivering a satisfying travel experience for our guests.

77%
On-Time Performance in 2023
(s 20% from 2022)
80%
Passenger Load Factor in 2023
(s 2% from 2022)

The initiatives undertaken by AirAsia X to improve our OTP are summarised as follows:-

OTP Improvement Initiatives

Precision Timing Dual Aerobridge Pre-Planned Aircraft Seasonal Ground and
Operations Swaps Block Time Reviews
Refers to the practice of Indicates simultaneously Preemptively identifying Continuously review ground
scheduling and conducting using two aerobridges flights with minimum and block times to analyse
all ground and air operations (e n c l o s e d wa l kways ground time due to factors such as seasonal
with extreme accuracy. connecting the terminal and delays from the previous winds and forecasted
aircraft) for boarding and sector; and implementing passenger volume to
This practice streamlines disembarking passengers. our equipment swaps to maintain peak operational
departmental procedures This speeds up the boarding normalise turnaround times. efficiency.
to consistently achieve and disembarking process,
our 75-minute planned particularly for our aircraft,
turnaround time. which has a high-density
layout.

2023 Annual Report 67

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Guest Satisfaction
Ensuring our guests enjoy every step of their travel journey is a priority of AirAsia X. To gauge how we are doing,
we engage Capital A’s Customer Happiness department to jointly track two key metrics: the Net Promoter Score
(“NPS”) and the Customer Satisfaction Score (“CSAT”). These insights guide our efforts to enhance our guests’
experience and meet their needs, thus ensuring continuous improvements.

In 2023, over 160,316 guests provided valuable feedback, which helped us identify key areas for improvement.
While our NPS decreased by 5 points to 32 in 2023, our CSAT significantly rose from 43% in 2022 to 70% in
2023. This positive shift in CSAT likely reflects our efforts to reduce wait times and accelerate the refund process.
Concurrently, we have been actively addressing the issues highlighted in the NPS survey, particularly technical
difficulties with the AirAsia website and app, and payment failures during booking.

32
NPS in 2023
(t 5 points from 2022)
70%
CSAT in 2023
(s 27% from 2022)

Some of the initiatives undertaken by AirAsia X to improve our NPS and CSAT scores are summarised as follows:-

Addressing Booking Speed Service Recovery Options for Flight Disruption

We are actively optimising the booking experience We offer a range of service recovery options for our
on both airasia MOVE and website to ensure faster guests in the event of disrupted flights, including
loading time during our guests’ booking. refunds, meal vouchers and free flight rescheduling,
depending on the period of flight disruption.
Enhancing Cabin Hygiene
We are undertaking a comprehensive review of cleaning procedures within the cabin, focusing on
high-contact areas. We are also collaborating closely with cabin crew via surveys to gather more in-depth
insights regarding the standard of cabin cleanliness. Additionally, we are continuously engaging with the
engineering department and third-party cleaning service providers to optimise amenities (including fragrances
and tissues) and implement continuous improvement initiatives.

In 2023, we collaborated with our affiliates to introduce AskBo, the latest AI chatbot, which is designed to
address customer queries more efficiently and swiftly. Among the new capabilities featured in AskBo are:

• live updates on flight status in multiple languages

• notifications alerting guests to any operational changes
• real-time automatic updates of departure timing directly into the electronic boarding pass

Via AskBo, customers are also able to submit their compliments and complaints to us, thus ensuring we
continuously improve our services. AskBo is available on both the MOVE website and mobile app.

68 AirAsia X Berhad
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DRIVING TECHNOLOGY, INNOVATION AND DATA SECURITY

2023 PERFORMANCE OVERVIEW
[GRI 3-3]

We have seamlessly transitioned to cloud-based data storage and business process automation across our
operations, hence solidifying our status as a digital-centric organisation. This has unlocked various benefits,
including streamlined data management, collaborative workflows, and noteworthy reductions in paper usage
and carbon emissions at AirAsia X.

While cybersecurity remains a constant challenge, we remain committed to adopting cutting-edge technology
across our entire value chain, specifically focusing on innovative and cost-effective experiences for our employees.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• Information Security Policy Data breaches in AirAsia X
• Data Governance Policy 0
• Server, Database and Network
Hardening Policy
• Information Security Incident
Response SOP
• ISO/IEC 27001:2022 Information
security, cybersecurity and
privacy protection - Information
security management system
requirements
• Personal Data Protection Act
2010
• Data Security & Privacy

2023 Annual Report 69

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TECHNOLOGY & INNOVATION

[GRI 201-1]

Building on the momentum of our key digitalisation initiatives in 2022, we further bolstered our efforts to
minimise paper wastage, and hence our scope 3 carbon footprint, as outlined below:

DIGITAL TRIP FILES AUTO-UPLOAD OF

(“DTF”) PASSENGER MANIFEST
• Trip files are sets of documents filed by Ground • The passenger manifest contains details of
Operations to record flight arrivals, with each passengers and their flight numbers, which is
file containing an average of 20 sheets of A4 now automatically stored in our local drives.
documents. • In 2023, passenger manifests for both inbound
• By replacing manual filing with DTF, a secure and outbound Kuala Lumpur flights are now
cloud platform, we have eliminated paper automatically transmitted to the relevant
printing and streamlined Ground Operations immigration authorities within thirty minutes
for flight arrivals. of the actual time of departure, thus enhancing
• In 2023, the DTF was upgraded with a user- operational efficiency.
friendly interface and cloud storage. Upon
final CAAM approval, DTF would be fully
implemented by AirAsia X in 2024.

In addition, we are moving towards the digitalisation of employee attestation data in 2024. This exercise would
allow pilots and cabin crew to store required documents (licences, training records, etc.) on their mobile devices,
linked directly to the airline information management system (“AIMS”).

CYBERSECURITY & DATA PRIVACY

[GRI 418-1]

At AirAsia X, we are fully committed to ensuring robust cybersecurity and data privacy, which is imperative in
safeguarding our customers’ information. By leveraging the same information security governance, policies,
and initiatives of our affiliates, we harness the collective power of our network to safeguard all vital data and
information.

Information Security Governance

Group Chief • Process owner of all company, employee, guest, and
Information partner data confidentiality, integrity, and availability.
Security Officer • Sets and implements information security policies,
Group Chief Information (“CISO”) ensuring adequate asset protection.
Security Officer • Regularly reports to the Board on security measures.
Group Information • Defines information security objectives and enforces
Security Teams policy compliance.
Group Information • Implements the Data Governance Policy, thereby
Security Teams managing information based on classification.
• Mitigates security incidents and controls risks.
• Tests security controls and designs security
awareness training.
Heads of Department Heads of • Enforces information security policies within their
Department departments.
• Liaises with Group Information Security on incidents,
audits, risks, concerns, and policy exceptions.

70 AirAsia X Berhad
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In 2023, we achieved zero incidents of data breaches.

0
Substantiated complaints
concerning breaches of guest
privacy and losses of guest
data for AirAsia X in 2023

Some of the initiatives undertaken by AirAsia X to improve our cybersecurity measures are summarised as
follows:

Cybersecurity and Data Privacy Measures

UPGRADING SECURITY SYSTEM IMPROVING SERVER PROTECTION

We have upgraded to a smarter security system We have installed a set of security controls
called Endpoint Detection and Response (“EDR”) named Privileged Access Management (“PAM”)
to replace outdated antivirus software to protect to guard our most sensitive servers, whereby only
end-point devices (eg: mobile devices, laptops authorised users can access.
etc.). EDR tracks down advanced threats such
as malware and ransomware that can evade past
traditional defences (eg: firewalls).

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ROBUST CORPORATE GOVERNANCE

2023 PERFORMANCE OVERVIEW
[GRI 3-3]

Maintaining an unwavering commitment to exemplary corporate governance and ethical conduct at all levels
is of great importance to AirAsia X’s enduring success and continued expansion. We conduct our business
with integrity, guided by strong leadership, robust risk management frameworks, and comprehensive internal
controls. By fostering a culture of robust corporate governance throughout the organisation, we ensure that we
can deliver long-term value to all our stakeholders.

KEY POLICIES & PRIMARY UN SDGs 2023

PROCEDURES SUPPORTED IN NUMBERS
• Anti-Bribery and Anti-Corruption Percentage of operations assessed
Policy for corruption-related risks
• Enterprise Risk Management 100%
Policy
• Code of Business Conduct Confirmed incidents of bribery and
• Whistleblowing Policy corruption
• Disciplinary Policy 0
• Remuneration Policy Statement
• Board Diversity Policy
• Board Charter
• Directors’ Fit and Proper Policy

ETHICAL BUSINESS CONDUCT

[GRI 2-15, 2-23, 2-24, 2-27, 205-2, 205-3]

Integrity guides our journey at AirAsia X. Therefore, we ensure the highest ethical standards by leveraging
comprehensive internal controls and robust risk management, all guided by a clear framework of codes and
policies.

Code of Business Conduct

The Code of Business Conduct guides every Allstar at AirAsia X. This policy tackles crucial ethical considerations
such as bribery and corruption, information security, whistleblowing and conflicts of interest. By embracing
these principles, we collectively safeguard AirAsia X’s reputation and contribute to a sustainable future.

2023 Performance
• 100% of new joiners completed live training on the Code of Business Conduct as part of their onboarding.
They were also required to acknowledge that they accept and will uphold its standards.

Anti-Bribery & Anti-Corruption

AirAsia X adopts a zero-tolerance stance against fraud, bribery and corruption. Therefore, we partner with
stakeholders throughout our operations to ensure ethical practices. All employees and directors are expected to
abide by our comprehensive Anti-Bribery and Anti-Corruption (“ABAC”) policy, aligned with Section 17A of the
Malaysian Anti-Corruption Commission Act 2009.

72 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

2023 Performance
• From day one, our new Allstars receive comprehensive training on our ABAC policy. Live sessions led by the
People and Culture team, supplemented by online modules, equip them with the knowledge and tools to
conduct their work ethically.
• The policy is readily accessible on our RedDocs intranet for ongoing reference.
• The Anti-Bribery & Anti-Corruption Policy awareness programme was launched in 2020 to all employees.
All new employees recruited post-pandemic during 2022/2023, have been trained on the Anti-Bribery and
Anti-Corruption Policy. In 2023, 396 AirAsia X new joiners completed the training and acknowledged the
ABAC policy during their onboarding session.
• The breakdown by employee categories are as follows:

Category FYE 2023 FYE 2023

No of New Joiners New Joiners in %
Leadership Team 01 0%
Management 01 0%
Manager 14 24%
Executive 362 30%
Non-Executive 20 47%

Note:
1
No new joiners for Leadership Team and Management in 2023

• We have launched a recurrent mandatory ABAC e-learning module and attestation to all staff in 2024 to
ensure all employees maintain and refresh their knowledge of the policy on an annual basis. Moving forward,
we will be able to track and report more accurately on the percentage of employees trained with the launch
of this online training.

For more information, please refer to AirAsia X’s Anti-Bribery and Anti-Corruption policy at
https://www.airasiax.com/misc/AAX_ABAC_Policy.pdf

Whistleblowing
[GRI 2-16, 2-25, 2-26]

At AirAsia X, open communication is key to upholding ethical practices. We provide secure channels for
AirAsia X employees, directors and other stakeholders to raise concerns about any unethical, illegal, or
inappropriate business conduct. The whistleblower’s identity, as per our Whistleblowing Policy, remains strictly
confidential or on a need-to-know basis, which ensures that the person is protected from any potential reprisal
or negative reaction. We take every report seriously and investigate thoroughly to ensure proper resolution
within the company, whenever possible.

Concerns can be raised through the following channels:

In 2023, we received a total of 1 report through our whistleblowing

channels, with 0 reports relating to bribery and corruption.

For more information, please refer to AirAsia X’s Whistleblowing Policy at

aax_whistleblower@airasia.com https://www.airasiax.com/whistleblowing_channel.html

https://www.airasiax.com/
misc/form_11012016.pdf

2023 Annual Report 73

SUSTAINABILITY
STATEMENT

RISK MANAGEMENT

Enterprise Risk Management

Recognising the pivotal role of risk management in our long-term success, we adhere to the principles outlined
in our ISO 31000:2018-compliant Enterprise Risk Management (“ERM”) Policy. This policy seamlessly integrates
with AirAsia X’s core operations and business processes, instilling a sense of accountability and ownership for
risk management practices at every level. Our ERM methodology is depicted below:

RISK RISK RISK RISK RISK

IDENTIFICATION ASSESSMENT CONTROL MONITORING REPORTING
Recognising the ever-growing importance of sustainability and ESG considerations, we have strategically
expanded the mandate of our Board RMC to encompass ESG risk management and sustainability-related
matters. As per the updated Terms of Reference, the RMC convenes quarterly and plays a vital role in overseeing
AirAsia X’s risk landscape. Their responsibilities encompass shaping the Company’s risk strategies, policies, and
processes, while meticulously ensuring the effective implementation of our robust ERM framework. Following
each RMC meeting, the Chairman provides clear and concise updates to the Board, keeping everyone informed
on important decisions and progress made.

Additionally, AirAsia X’s ERM Policy fosters a robust and standardised approach to identifying, assessing, and
mitigating risks, ultimately shaping a culture of proactive risk awareness within the company. Our three lines of
defence promote robust risk governance across all levels of the organisation:

BOARD

EXTERNAL ASSURANCE PROVIDERS

SENIOR MANAGEMENT RMC AUDIT COMMITTEE
EXTERNAL AUDITOR

BUSINESS VERTICALS RISK MANAGEMENT INTERNAL AUDIT

REGULATOR

Risk Taker / Owners Risk Governance Risk Assurance

1st Line of Defence 2nd Line of Defence 3rd Line of Defence
• P rovision of products/services to • S et directions, define policy, • Independently challenge to the
customers provide assessment and develop levels of assurance provided by
• Day-to-day risk management risk management framework business operations and oversight
decision-making • Oversight the level of risk and functions
• Continuous risk identification, appetite in the organisation • R ev i e w a p p r o p r i a t e n e s s
assessment, mitigation, monitoring • Independent reporting and effectiveness and adequacy of
and management escalation to the Board and RM the risk management framework
• Compliance to regulatory and • Review and challenge 1 Line of
st

internal policies Defence

For more information on our risk management processes and initiatives in 2023, please refer to the Statement on Risk
Management & Internal Control within this Annual Report 2023 on pg 94-105.

74 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

Managing Climate Risk

Recognising the diverse impact of climate change across the countries where we operate, we are leveraging the
TCFD framework to pinpoint specific climate-related risks, thereby empowering risk owners to assess and report
them through our robust risk management system. These concerns are also on our Business Continuity Plan’s
radar, closely monitored to prevent any turbulence in our operations. As climate change intensifies, AirAsia X
acknowledges its gravity, placing it among the most complex risks facing companies globally.

TCFD Pillars Executive Summary FYE 2023 Highlights

Recognising the importance of a top- In 2023, we expanded the mandate of the Company’s
down approach in managing climate- RMC to include oversight on ESG risk management and
related risks and opportunities, we sustainability-related matters.
strive to continuously improve our
governance structure in managing Additionally, we also established the Sustainability Steering
Governance the risks and opportunities presented Committee and the Sustainability Working Group, which are
by sustainability and climate change. tasked to develop sustainability strategies and implement
sustainability initiatives within the organisation, respectively.

For more information, please refer to Chapter 1: Our Sustainability

Approach
In line with the ICAO’s aspirational goal Fuel-efficiency initiatives have been a long-standing practice
of achieving net-zero carbon emissions at AirAsia X in the past decade. Notably, we avoided 5,395
from international flight operations tCO2 via our fuel efficiency initiatives in 2023.
by 2050, we are assessing the actual
and potential impacts of climate- In alignment with ICAO’s Long Term Aspirational Goal,
Strategy related risks and opportunities on we are working towards implementing four low-carbon
our businesses, strategy and financial aviation strategies, namely operational efficiency, latest
planning. aircraft technologies, sustainable aviation fuel and carbon
offsetting via purchase of carbon credits.

For more information, please refer to Chapter 2: Addressing

Climate Change
As an international airline, we recognise We plan to include ESG risks and climate-related risks in
our high exposure to the CORSIA our Risk Register by 2024.
scheme, coming into effect in 2024.
Therefore, we strive to identify, assess, We also consistently monitor the evolving climate-related
and manage our climate-related risks, regulations and SAF mandates for the destinations that
Risk which include staying ahead of evolving we fly to.
Management climate regulations SAF mandates
implemented by the countries we serve. For more information, please refer to Chapter 1: Our Sustainability
Approach
We continuously track the GHG In 2023, we started monitoring our GHG emissions
emissions from our operations and from all 3 scopes. For scope 3, we track categories 3, 6
our upstream value chain, in order to and 7, which includes fuel-and energy-related activities
assess and manage relevant climate- not included in scope 1 or scope 2, business travel and
related risks and opportunities. employee commute.
Metrics &
Targets In addition, the CORSIA scheme The carbon intensity per RPK has seen a 34% reduction
dictates that from 2024 onwards, the to 78.3 gCO2 /RPK in 2023 from 118.1 gCO2 /RPK in 2022,
baseline emissions between CORSIA- owing to the increased load factors this year. Similarly,
contracting states would be reduced the carbon intensity per ASK has declined by 32% to 61.3
to 85% of 2019’s emissions. Emissions gCO2 /ASK in 2023 from 89.9 gCO2 /ASK in 2022, owing
above this baseline would need to be to longer average flight times as our network was rebuilt.
offset via the purchase of CORSIA-
eligible fuels or CORSIA-eligible carbon For more information, please refer to Chapter 2: Addressing
credits. Climate Change

2023 Annual Report 75

SUSTAINABILITY
STATEMENT

SUSTAINABLE SUPPLY CHAIN

2023 PERFORMANCE OVERVIEW
[GRI 3-3]

Every supplier plays a crucial role in reducing our environmental and social impact. Therefore, we collaborate
closely with our suppliers to ensure timely deliveries and fair prices. Wherever possible, we invest in local
businesses, thereby further strengthening our communities. Additionally, we leverage our influence to promote
responsible and ethical sourcing practices outlined in the Supplier Code of Conduct (“SCOC”). This ensures a
sustainable supply chain that benefits everyone – from our partners to passengers and the planet.

KEY POLICIES & PROCEDURES PRIMARY UN SDGs 2023

• Anti-Bribery and Anti-Corruption
SUPPORTED IN NUMBERS
Policy
Percentage expenditure on local
• Environmental Policy Statement
suppliers
• Supplier Code of Conduct
34%

Number of existing suppliers

2,707

Number of new suppliers in 2023

BELOW ARE SOME OF THE GOODS THAT WE PROCURE WITHIN OUR OPERATIONS:

In-flight Technology Aviation Ground Aviation Fuel Aircraft Fleet

Catering Systems Maintenance & Handling and Engines
Materials

76 AirAsia X Berhad
SUSTAINABILITY
STATEMENT

SUSTAINABLE PROCUREMENT
AirAsia X engages with its affiliates’ Group Procurement team to secure the most competitive prices for
our purchases. This department also streamlines and optimises sourcing needs by leveraging Oracle, the
cloud-based procurement management system.

All potential suppliers of AirAsia X must register in Oracle and complete a comprehensive questionnaire
covering key areas such as quality, cost competitiveness, and regulatory compliance. Additionally, suppliers
must acknowledge our ABAC Policy and SCOC, which is a mandatory prerequisite for any supplier wishing to
partner with AirAsia X.

Supplier Selection Process

[GRI 204-1]

Below is a snapshot of our supply chain selection process:

STEP 1: STEP 2: STEP 3:

REQUEST FOR PROPOSALS & SUPPLIER ASSESSMENT SUPPLIER SELECTION &
QUOTATIONS & EVALUATION AWARD OF CONTRACT
To work with us, suppliers We evaluate the submissions Following a thorough evaluation,
must comply with our SCOC, from our potential suppliers and we present the shortlisted
which outlines responsible and assess their capabilities (quantity suppliers to the relevant
ethical business practices. This and quality of goods, fair pricing, procurement departments and
applies to any supplier who etc.), and other commercial stakeholders for their final review
intends to submit a Request for requirements. The suppliers also and approval. Once a supplier is
Proposal (“RFP”) or Request for need to be financially stable and chosen, we solidify the partnership
Quotation (“RFQ”) to us. meet our ethical standards (SCOC with a clear contract outlining the
and ESG requirements). responsibilities of both AirAsia
X and the supplier. Therein, we
actively monitor the performance
of our suppliers.

66% 34%
2023
57% 43%
2022

61% 39%
2021

International suppliers Local suppliers

Our investment in our local supplier network grew in 2023 with expenditure rising from RM346 million in 2022
to RM995 million in 2023, representing a 2.9-fold increase. This surge paralleled the broader resurgence in travel
patterns across the region. Furthermore, we warmly welcomed 74 new partners into our fold, expanding our
total supplier portfolio to 2,707.

SANTAN, our primary in-flight meal supplier, prioritises sourcing the freshest ingredients. Recognising the
value of local partnerships in upholding this principle, SANTAN procured 99% of its inflight catering supplies
from domestic sources in 2023. This commitment to local sourcing not only strengthens our ties with local
communities but also guarantees a flavourful and authentic dining experience for our passengers.

2023 Annual Report 77

PERFORMANCE
DATA TABLE
Indicator Measurement Unit 2023
Corporate Governance
Bursa C1(a) Percentage of employees who have received training on anti-corruption by
employee category
Leadership Team Percentage 0.00
Management Percentage 0.00
Manager Percentage 24.10
Executive Percentage 29.94
Non-Executive Percentage 46.51
Bursa C1(b) Percentage of operations assessed for corruption-related risks Percentage 100.00
Bursa C1(c) Confirmed incidents of corruption and action taken Number 0
Customer Service
On-Time Performance (OTP) Percentage 77.00
Net Promoter Score (NPS) Number 32
Customer Satisfaction Score (CSAT) Percentage 70.00
Data Privacy & Security
Bursa C8(a) Number of substantiated complaints concerning breaches of customer Number 0
privacy and losses of customer data
Supply Chain Management
Bursa C7(a) Proportion of spending on local suppliers Percentage 33.84
Labour Practices, Standards & Diversity
Bursa C3(a) Percentage of employees by gender and age group, for each employee
category
Age Group by Employee Category
Leadership Team Under 30 Percentage 0.00
Leadership Team Between 30-50 Percentage 50.00
Leadership Team Above 50 Percentage 50.00
Management Under 30 Percentage 0.00
Management Between 30-50 Percentage 66.67
Management Above 50 Percentage 33.33
Manager Under 30 Percentage 6.90
Manager Between 30-50 Percentage 72.41
Manager Above 50 Percentage 20.69
Executive Under 30 Percentage 30.60
Executive Between 30-50 Percentage 64.19
Executive Above 50 Percentage 5.21
Non-Executive Under 30 Percentage 55.81
Non-Executive Between 30-50 Percentage 39.53
Non-Executive Above 50 Percentage 4.65
Gender Group by Employee Category
Leadership Team Male Percentage 62.50
Leadership Team Female Percentage 37.50
Management Male Percentage 77.78
Management Female Percentage 22.22
Manager Male Percentage 72.41
Manager Female Percentage 27.59
Executive Male Percentage 49.88
Executive Female Percentage 50.12
Non-Executive Male Percentage 72.09
Non-Executive Female Percentage 27.91

Internal assurance External assurance No assurance (*)Restated

78 AirAsia X Berhad
PERFORMANCE
DATA TABLE

Indicator Measurement Unit 2023

Bursa C3(b) Percentage of directors by gender and age group
Male Percentage 83.33
Female Percentage 16.67
Under 30 Percentage 0.00
Between 30-50 Percentage 0.00
Above 50 Percentage 100.00
Bursa C6(a) Total hours of training by employee category
Leadership Team Hours 43
Management Hours 358
Executive Hours 18,580
Non-Executive Hours 324
Bursa C6(b) Percentage of employees that are contractors or temporary staff Percentage 28.00
Bursa C6(c) Total number of employee turnover by employee category
Leadership Team Number 2
Management Number 6
Manager Number 5
Executive Number 30
Non-Executive Number 0
Bursa C6(d) Number of substantiated complaints concerning human rights violations Number 3
Health & Safety
Bursa C5(a) Number of work-related fatalities Number 0
Bursa C5(b) Lost time incident rate (“LTIR”) Rate 1.01
Bursa C5(c) Number of employees trained on health and safety standards Number 1,236
Community Empowerment
Bursa C2(a) Total amount invested in the community where the target beneficiaries are MYR 2,190.00
external to the listed issuer
Bursa C2(b) Total number of beneficiaries of the investment in communities Number 18
Emissions & Climate-Related Strategy
Bursa C4(a) Total energy consumption Megawatt 3,637,620.00
Bursa C11(a) Scope 1 emissions in tonnes of CO2e Metric tonnes 960,280.00
Bursa C11(b) Scope 2 emissions in tonnes of CO2e Metric tonnes 206.00
Bursa C11(c) Scope 3 emissions in tonnes of CO2e (at least for the categories of business Metric tonnes 200,795.00
travel and employee commuting)
Waste Management
Bursa C9(a) Total volume of water used Megalitres 1.304000
Bursa C10(a) Total waste generated Metric tonnes 27.01
Bursa C10(a)(i) Total waste diverted from disposal Metric tonnes 0.00
Bursa C10(a)(ii) Total waste directed to disposal Metric tonnes 27.01

Notes:
1, The performance data table above is generated from the custom template of Bursa’s ESG reporting platform.
2. For indicator C1(a): The percentage of employees trained on anti-corruption refers to new joiners only.
3. For indicator C10(a) and C10(a)(ii), the number represents non-hazardous waste and solid hazardous waste only. Liquid hazardous waste is
excluded as the measurement unit is in litres.
4. For indicator C4(a), the measurement unit refers to Megawatt-hour.
5 For indicator C9(a) and C11(b), the data covers our operations in our head corporate office only, and excludes all hubs/stations as well as
any subsidiaries, due to data limitations.
6. For indicator C11(c):
a) Business travel data only covers air travel (flights) operated by external airlines, due to data limitations.
b) Employee commute data only covers employees that travel by car and are parking at our head corporate office only, due to data
limitations.

Internal assurance External assurance No assurance (*)Restated

2023 Annual Report 79

GRI CONTENT
INDEX
Pillars GRI Standard Disclosure Page Location Remarks
General Disclosures
GRI 2: The Organisation and its Reporting Practices
General 2-1 Organizational 23; 2-3 About This Statement
Disclosures details Annual Report: Corporate
2021 Profile, Corporate
General
Disclosure Information, Corporate
Structure
2-2 23, 2-3 About This Statement
Entities included in Annual Report: Corporate
the organization’s Profile, Corporate
sustainability Information, Corporate
reporting Structure
2-3 23 About This Statement
Reporting period,
frequency and
contact point
2-4 Restatements of - Significant restatements
information of data compared to
prior years are noted in
the section(s) where they
appear
2-5 24 AirAsia X has obtained
External assurance internal assurance for
selected Subject Matters
from the Company’s
Internal Audit department
to strengthen the credibility
of the Sustainability
Statement
Activities and Workers
2-6 24 Our Sustainability
Activities, Approach: We are AirAsia X
value chain and Annual Report: Corporate
other business Profile
relationships
2-7 57-63 Caring for Our People &
Employees Communities: Empowering
Allstars
2-8 - Information unavailable/
Workers who are incomplete
not employees

80 AirAsia X Berhad
GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

General GRI 2: Governance
Disclosure General 2-9 26; 4-11 Our Sustainability https://www.
Disclosures Governance Approach: Sustainability airasiax.com/
2021 structure and Governance directors.html
composition Annual Report: Leadership
Team
2-10 26; 4-11 Our Sustainability https://www.
Nomination and Approach: Sustainability airasiax.com/
selection of the Governance directors.html
highest governance Annual Report: Leadership
body Team

2-11 26; 4-11 Our Sustainability https://www.

Chair of the highest Approach: Sustainability airasiax.com/
governance body Governance directors.html
Annual Report: Leadership
Team
2-12 26; 4-11 Our Sustainability https://www.
Role of the highest Approach: Sustainability airasiax.com/
governance body Governance directors.html
in overseeing the Annual Report: Leadership
management of Team
impacts
2-13 26; 4-11 Our Sustainability https://www.
Delegation of Approach: Sustainability airasiax.com/
responsibility for Governance directors.html
managing impacts Annual Report: Leadership
Team
2-14 26 Our Sustainability
Role of the highest Approach: Sustainability
governance body Governance
in sustainability
reporting
2-15 73-74 Robust Corporate https://www.
Conflicts of interest Governance: Ethical airasiax.
Business Conduct; Code of com/misc/
Business Conduct AAX_Code_
of_Business_
Conduct.pdf
2-16 Communication 73-74 Robust Corporate https://www.
of critical concerns Governance: Ethical airasiax.com/
Business Conduct; whistleblowing_
Whistleblowing channel.html
2-17 4-11 Annual Report: Leadership https://www.
Collective Team airasiax.com/
knowledge of the directors.html
highest governance
body

2023 Annual Report 81

GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

General GRI 2: 2-18 26 Our Sustainability https://www.
Disclosure General Evaluation of the Approach: Sustainability airasiax.com/
Disclosures performance of the Governance directors.html
2021 highest governance Annual Report: Corporate
body Governance Overview
Statement
2-19 Remuneration - https://www.airasiax.com/
policies misc/AAX_Remuneration_
Policy_Statement.pdf
2-20 - https://www.airasiax.com/
Process to misc/AAX_Remuneration_
determine Policy_Statement.pdf
remuneration
2-21 90; Annual Report: Corporate
Annual total 115-127 Governance Overview
compensation ratio Statement; Remuneration
Annual Report: Financial
Statements
Strategy, Policies and Practices
2-22 25 Our Sustainability
Statement on Approach: Sustainability
sustainable Framework
development
strategy
2-23 73-74 Robust Corporate https://www.
Policy commitments Governance: Ethical airasiax.
Business Conduct; Code of com/misc/
Business Conduct AAX_Code_
of_Business_
Conduct.pdf
2-24 73-74 Robust Corporate https://www.
Embedding policy Governance: Ethical airasiax.
commitments Business Conduct; Code of com/misc/
Business Conduct AAX_Code_
of_Business_
Conduct.pdf
2-25 73-74 Robust Corporate https://www.
Processes to Governance: Ethical airasiax.com/
remediate negative Business Conduct; whistleblowing_
impacts Whistleblowing channel.html
2-26 73-74 Robust Corporate https://www.
Mechanisms for Governance: Ethical airasiax.com/
seeking advice and Business Conduct; whistleblowing_
raising concerns Whistleblowing channel.html
2-27 73-74 Robust Corporate
Compliance with Governance: Ethical
laws and regulations Business Conduct
2-28 Membership - Information unavailable/
associations incomplete

82 AirAsia X Berhad
GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

General GRI 2: Stakeholder Engagement
Disclosure General 2-29 30-32 Our Sustainability
Disclosures Approach to Approach: Stakeholder
2021 stakeholder Engagement
engagement
2-30 - Information unavailable/
Collective incomplete
bargaining
agreements
Material Topics
GRI 3: 3-1 32-34 Our Sustainability
Material Process to Approach: Materiality
Topics 2021 determine material Assessment
topics
3-2 32-34 Our Sustainability
List of material Approach: Materiality
topics Assessment
Corporate Governance
GRI 3: 3-3 72-77 Robust Corporate
Material Management of Governance
Topics 2021 material topics
Economic GRI 205: 205-2 73-74 Robust Corporate
Anti- Communication and Governance: Ethical
corruption training about anti- Business Conduct
2016 corruption policies
and procedures
205-3 73-74 Robust Corporate
Confirmed incidents Governance: Ethical
of corruption and Business Conduct
actions taken
Customer Service
GRI 3: 3-3 66-68 Enhancing Guest
Material Management of Experience
Topics 2021 material topics
GRI 418: 418-1 Substantiated 71-72 Driving Technology,
Customer complaints Innovation and Data
Privacy 2016 concerning Security: Cybersecurity &
breaches of Data Privacy
customer privacy
and losses of
customer data
Data Security and Privacy
GRI 3: 3-3 69-72 Driving Technology,
Material Management of Innovation and Data
Topics 2021 material topics Security
GRI 418: 418-1 Substantiated 71-72 Driving Technology,
Customer complaints Innovation and Data
Privacy 2016 concerning Security: Cybersecurity &
breaches of Data Privacy
customer privacy
and losses of
customer data

2023 Annual Report 83

GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

Economic Supply Chain Management
GRI 3: 3-3 77-78 Sustainable Supply Chain
Material Management of
Topics 2021 material topics
GRI 204: 204-1 77-78 Sustainable Supply Chain:
Procurement Proportion of Sustainable Procurement
Practices spending on local
2016 suppliers
Emissions and Climate-related Strategy
GRI 3: 3-3 36-44 Towards Low-Carbon
Material Management of Operations
Topics 2021 material topics
Environmental GRI 302: 302-1 41 Towards Low-Carbon
Energy 2016 Energy Operations: GHG Emissions
consumption within Management; Scope 1 GHG
the organization Emissions

302-2 42-43 Towards Low-Carbon

Energy Operations: GHG Emissions
consumption Management; Scope 3 GHG
outside of the Emissions
organization
302-4 37-38 Towards Low-Carbon
Reduction of energy Operations: Low-Carbon
consumption Transition Strategies
GRI 305: 305-1 41 Towards Low-Carbon
Emissions Direct (Scope 1) Operations: GHG Emissions
2016 GHG emissions Management; Scope 1 GHG
Emissions
305-2 41 Towards Low-Carbon
Energy indirect Operations: GHG Emissions
(Scope 2) GHG Management; Scope 2 GHG
emissions Emissions
305-3 42-43 Towards Low-Carbon
Other indirect Operations: GHG Emissions
(Scope 3) GHG Management; Scope 3 GHG
emissions Emissions
GRI 305: 305-4 41 Towards Low-Carbon
Emissions GHG emissions Operations: GHG Emissions
2016 intensity Management; Scope 1 GHG
Emissions
305-5 37-40 Towards Low-Carbon
Reduction of GHG Operations: GHG Emissions
emissions Management; Scope 1 GHG
Emissions
305-7 43 Towards Low-Carbon
Nitrogen oxides Operations: GHG Emissions
(NOx), sulfur oxides Management; Other GHG
(SOx), and other Emissions
significant air
emissions

84 AirAsia X Berhad
GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

Environmental Waste Management
GRI 3: 3-3 44-45 Managing our
Material Management of Environmental Footprint:
Topics 2021 material topics Waste Management
GRI 303: 303-1 Interactions 46 Managing our
Water and with water as a Environmental Footprint:
Effluents 2018 shared resource Water Management
GRI 306: 306-1 44-45 Managing our
Waste 2020 Waste generation Environmental Footprint:
and significant Waste Management;
waste-related Hazardous Waste and Non-
impacts Hazardous Waste
306-2 Management 44-45 Managing our
of significant waste- Environmental Footprint:
related impacts Waste Management;
Hazardous Waste and Non-
Hazardous Waste
306-3 44-45 Managing our
Waste generated Environmental Footprint:
Waste Management;
Hazardous Waste and Non-
Hazardous Waste
306-4 44-45 Managing our
Waste diverted from Environmental Footprint:
disposal Waste Management;
Hazardous Waste and Non-
Hazardous Waste
306-5 44-45 Managing our
Waste directed to Environmental Footprint:
disposal Waste Management;
Hazardous Waste and Non-
Hazardous Waste
Health and Safety
GRI 3: 3-3 48-56 Safety as our Priority
Material Management of
Topics 2021 material topics
Social

2023 Annual Report 85

GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

Social GRI 403: 403-1 Occupational 49-50 Safety as our Priority:
Occupational health and safety Ensuring Robust Safety
Health and management Governance
Safety 2018 system
403-2 50 Safety as our Priority:
Hazard Ensuring Robust Safety
identification, Governance; Hazard
risk assessment, Identification & Risk
and incident Assessment
investigation
403-3 Occupational 49-50 Safety as our Priority:
health services Ensuring Robust Safety
Governance
403-4 49-50 Safety as our Priority:
Worker Ensuring Robust Safety
participation, Governance
consultation, and
communication on
occupational health
and safety
403-5 54 Safety as our Priority:
Worker training on Embedding a Safety-First
occupational health Culture; Safety Training
and safety
403-6 54 Safety as our Priority:
Promotion of Embedding a Safety-First
worker health Culture; Safety Promotion
403-7 51 Safety as our Priority:
Prevention and Driving Operational Safety
mitigation of Performance
occupational
health and safety
impacts directly
linked by business
relationships
403-8 49-50 Safety as our Priority:
Workers covered Ensuring Robust Safety
by an occupational Governance
health and safety
management
system
403-9 51 Safety as our Priority:
Work-related Driving Operational Safety
injuries Performance

86 AirAsia X Berhad
GRI CONTENT
INDEX

Pillars GRI Standard Disclosure Page Location Remarks

Social Labour Practices, Standards & Diversity
GRI 3: Material 3-3 57-63 Empowering Allstars
Topics 2021 Management of
material topics
GRI 401: 401-1 63 Empowering Allstars:
Employment New employee Championing Allstars;
2016 hires and employee Employee Turnover
turnover
401-2 62 Empowering Allstars:
Benefits provided to Championing Allstars;
full-time employees Talent Engagement
that are not provided
to temporary or part-
time employees
GRI 404: 404-1 60-62 Empowering Allstars:
Training and Average hours of Championing Allstars;
Education training per year per Talent Upskilling
2016 employee
404-2 60-62 Empowering Allstars:
Programs for Championing Allstars;
upgrading employee Talent Upskilling
skills and transition
assistance programs
404-3 Percentage 63 Empowering Allstars:
of employees Championing Allstars;
receiving regular Talent Engagement
performance and
career development
reviews
GRI 405: 405-1 57-59 Empowering Allstars:
Diversity Diversity of Promoting Diversity, Equity
and Equal governance bodies and Inclusion; Workforce
Opportunity and employees Diversity
2016
405-2 57-59 Empowering Allstars:
Ratio of basic salary Promoting Diversity, Equity
and remuneration of and Inclusion; Gender Pay
women to men Gap
Community Empowerment
GRI 3: Material 3-3 63-64 Supporting our
Topics 2021 Management of Communities
material topics
GRI 413: Local 413-1 63-64 Supporting our
Communities Operations with Communities
2016 local community
engagement,
impact assessments,
and development
programs

2023 Annual Report 87

CORPORATE GOVERNANCE
OVERVIEW STATEMENT
The Board of Directors (“Board”) of AirAsia X Berhad (“AirAsia X” or “the Company”) presents this Corporate
Governance Overview Statement to provide shareholders and investors with an overview of the corporate governance
practices of the Company under the leadership of the Board for the financial year ended 31 December 2023
(“FYE 2023”). In building a sustainable business for a leading medium-haul, low-cost airline, operating primarily in
the Asia-Pacific region, the Board is mindful of its accountability towards its shareholders and various stakeholders.
The Board and Senior Management are committed to providing effective leadership and promoting uncompromising
ethical standards in the organisation, and towards ensuring excellence in its corporate governance standards and
practices throughout the Company, to which the explanations on each application of the recommended practices
are disclosed in the Company’s Corporate Governance Report 2023 (“CG Report 2023”).

This statement is prepared in compliance with Main Market Listing Requirements (“MMLR”) of Bursa Malaysia
Securities Berhad (“Bursa Securities”), and it is to be read together with the CG Report 2023 which is available
on the Company’s website at http://www.airasiax.com. The CG Report 2023 provides the details on how the
Company has applied each Practice as set out in the Malaysian Code on Corporate Governance (“MCCG”) during
the FYE 2023.

The Board presents this statement to provide an insight into the corporate governance practices of the Company
under the leadership of the Board with reference to three (3) key corporate governance principles:–

(a) board leadership and effectiveness;

(b) effective audit and risk management; and
(c) integrity in corporate reporting and meaningful relationship with stakeholders.

PRINCIPLE A
BOARD LEADERSHIP AND EFFECTIVENESS

1. Board Responsibilities

The Board is responsible for overseeing the overall management of the Group and retains full and effective
control over the business and affairs of the Group. The Board reviews the Group’s key policies, business
plans and strategies, actively oversees the conduct, management and business affairs of the Company and
monitors the Senior Management’s performance. The Board ensures the effective discharge of its fiduciary
and leadership functions, as well as sustaining long-term shareholder value while safeguarding the interests
of all the stakeholders. It works closely with the Senior Management to ensure that the operations of the
Company are conducted prudently within the framework of relevant laws and regulations.

Directors have independent access to the advice and dedicated support services of the Company Secretary
(who is legally qualified to act as Company Secretary under the Companies Act 2016) to ensure effective
functioning of the Board. The Directors may seek advice from Senior Management on issues pertaining to
their respective jurisdiction as well as independent professional advice in discharging their duties.

The Board recognises that having established and clearly defined roles and responsibilities of the Board and
the Senior Management is important to strike a reasonable balance between the strategy foundation and
policy-making on the one hand, and the conformance roles of executive supervision and accountability on
the other.

Delegation of the Board’s authority to the Senior Management is subject to defined limits of authority and
monitoring by the Board. However, as the Board has the overall responsibility to manage and supervise the affairs
of the Company in accordance with the law, there are matters which are reserved for the Board’s consideration
as set out in the Board Charter which is available on the Company’s website at http://www.airasiax.com.

There is a clear separation of the positions and roles between the Chairman and the Chief Executive Officer
(“CEO”) to promote greater accountability to enhance checks and balances. The positions of the Chairman
and the CEO are held by two (2) different individuals. Their respective roles are also described in the Board
Charter.

88 AirAsia X Berhad
CORPORATE GOVERNANCE
OVERVIEW STATEMENT

The Board has delegated certain functions to the Board Committees it established to assist in the execution
of its responsibilities. The Board Committees operate under clearly defined Terms of Reference which are also
available on the Company’s website at http://www.airasiax.com. The Board Committees are authorised by
the Board to deal with and to deliberate on matters delegated to them within their Terms of Reference. The
Chairs of the respective Board Committees report to the Board on the outcome of their Board Committee
meetings. The governance structure of the Board is as follows:-

Audit Committee

Senior Management Nomination and

Remuneration Committee
Board Internal Audit

Company Secretary Risk Management

Committee

Safety Board Review

i) Board

Our Board is collectively responsible for the effective oversight of the Company and its businesses by
actively overseeing the conduct and directing the management of the business and affairs of the Company
towards enhancing business prosperity and corporate accountability with the ultimate objective of
meeting the goals of the Company, realising long term shareholder value and safeguarding the interests
of stakeholders. The Board sets the risk appetite and determines the principal risks for the Company and
takes the lead in areas such as safeguarding the reputation of the Company and its financial policy, as
well as making sure to maintain a sound system of internal control and risk management.

The Chairman oversees the Board in the effective discharge of its role and to instill good corporate
governance practices, leadership and effectiveness of the Board. To monitor the workings of the Board
and the conduct of the Board meeting to ensure all relevant issues for the effective running of the
Company’s business are on the agenda for the Board meetings. The Chairman ensures that quality
information to facilitate decision-making is delivered to Board members on a timely basis, to encourage
all Directors to play an active role in Board activities, including leading Board meetings and discussions,
encouraging active participation and allowing dissenting views to be freely expressed. The Chairman
manages the interface between the Board and the Management and ensures that appropriate steps are
taken to provide effective communication with stakeholders and that their views are communicated to
the Board as a whole, and to chair general meetings of shareholders.

ii) Senior Management

The Senior Management is led by the CEO of the Company.

CEO

The CEO leads the management of the Company and provides direction for the implementation of the
strategies and business plans as approved by the Board and the overall management of the business
operations group-wide. The CEO also chairs the Senior Management Team which assists him in his
management of the Company, particularly in relation to strategic business development, high impact
and high value investments, and cross business matters of the Group.

2023 Annual Report 89

CORPORATE GOVERNANCE
OVERVIEW STATEMENT

iii) Company Secretary

The Board is supported by a qualified and competent Company Secretary to provide sound governance
advice, ensure adherence to Board policies, rules and procedures, and advocate adoption of corporate
governance best practices. The Directors always have access to the advice and services of the Company
Secretary, especially relating to procedural and regulatory requirements such as company and securities
laws and regulations, governance matters and MMLR.

iv) Audit Committee (“AC”)

The AC assists the Board in fulfilling its oversight functions in relation to internal controls and financial
reporting of the Company. The AC provides the Board with assurance on the quality and reliability of
the financial information reported by the Company whilst promoting efficiency and good governance
practices to ensure the proper conduct and safeguarding of the Company’s and the Group’s assets.

v) Nomination and Remuneration Committee (“NRC”)

The NRC was established to assist the Board in discharging its responsibilities in the determination of
the remuneration and compensation of the Directors and Senior Management of the Company. The NRC
recommends to the Board the remuneration policy for the Non-Executive Directors and Senior Management
of the Company (as defined in its terms of reference). The NRC also reviews the Performance Scorecard
of the CEO and recommends the rating of the scorecard to the Board for its approval and oversees the
development of a succession management plan for the CEO. The NRC is also responsible for assessing the
performance of the Board and Board Committees, as well as making recommendations on the nomination
policy, succession planning framework, talent management, training programmes and any related matters
for Directors and Senior Management and overseeing succession planning for the Chairman and Directors.

vi) Risk Management Committee (“RMC”)

The RMC was established to oversee the risk management activities of the Company and the Group.
It supports the Board in fulfilling its responsibility for identifying significant risks and ensuring the
implementation of appropriate systems to manage the overall risk exposure of the Group.

vii) Safety Review Board (“SRB”)

The SRB provides oversight over the effective and efficient implementation of the Group’s Safety Policy
within the overall Group Safety Management System.

The members of the Board and its Committees have discharged their roles and responsibilities in respect
of the FYE 2023, through their attendance at the meetings of the Company as set out in the table below: -

Directors Board AC NRC RMC SRB

Dato’ Fam Lee Ee 8/8 4/4 4/4 4/4
(Non-Independent Non-Executive Director)
- Redesignated as Deputy Chairman and Chairman on
8 September 2023 and 18 December 2023
- Member of SRB
Datuk Kamarudin bin Meranun 7/8
(Non-Independent Non-Executive Director)
Tan Sri Asmat bin Kamaludin 6/8 5/5 4/4
(Independent Non-Executive Director)
- Resigned as AC member with effect from 23 January 2024
Chin Min Ming 8/8 5/5 3/4
(Independent Non-Executive Director)
- Appointed as RMC Chairman on 20 April 2023
- Appointed as NRC on 23 January 2024

90 AirAsia X Berhad
CORPORATE GOVERNANCE
OVERVIEW STATEMENT

Directors Board AC NRC RMC SRB

Dato’ Sri Mohammed Shazalli bin Ramly 1/1 1/1
(Independent Non-Executive Director)
- Appointed on 29 September 2023
- Appointed as SRB member on 29 September 2023
- Appointed as RMC member on 23 January 2024
- Appointed as AC member on 23 January 2024
- Appointed as SRB Chairman on 23 January 2024
Dato’ Abdul Mutalib bin Alias 1/1 1/1
(Independent Non-Executive Director)
- Appointed as Independent and Non-Executive Director on
29 September 2023
- AC member on 29 September 2023
- NRC member on 23 January 2024
- Appointed as RMC member on 23 January 2024
- Appointment as AC Chairman on 23 January 2024
Board members who ceased their services during the financial period
YM Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin 8/8 2/2 3/4
(Independent Non-Executive Chairman)
- Resigned as RMC member with effect from 31 May 2023
- Resigned as Chairman of the Board and SRB Chairman with
effect from 15 December 2023
Ahmad Al Farouk bin Ahmad Kamal 7/8 5/5 2/2
(Independent Non-Executive Director)
- Appointed as NRC member on 20 April 2023
- RMC member on 28 August 2023
- Resigned as Director, AC, NRC and RMC with effect from
15 December 2023

2. Board Composition

The size, balance and composition of the Board support its role that drives the long-term direction and strategy
of the Company. A key function of the Board is to create value for shareholders and track the progress of
each milestone that meets its business objectives. The Board also ensures that the Company upholds a high
level of corporate governance while meeting its other obligations to its shareholders and other stakeholders.
The Company has implemented procedures for the nomination and election of Directors through the NRC.
The NRC assesses candidates against the skills, knowledge and experience required by the Company. The
Company recognises the benefits of having a diverse Board.

In line with the Company’s Board Diversity Policy, the selection of candidates to join the Board is in part
dependent on the pool of candidates with the necessary skills, knowledge, and experience. The Board believes
that a truly diverse and inclusive Board will leverage the differences of its members, to achieve effective
stewardship and in turn, retain its competitive advantage. In this respect, the Board through its NRC conducts
an annual review of its size and composition, to determine if the Board has the right size and sufficient diversity
with elements of independence that fit the Company’s objectives and strategic goals.

The profile of each Director can be found on pages 04 to 07 of the Annual Report 2023. The Company’s diverse
Board includes and makes good use of differences in skills, regional and industry experience, background,
race, gender, ethnicity, age and other attributes of the Directors. The Company currently has one (1) woman
director on the Board. Due to the potential corporate exercises amidst the recovery phase of the Company,
the Board is taking a prudent approach in expanding its composition. The Board would consider appointing
additional Directors should the need arise.

2023 Annual Report 91

CORPORATE GOVERNANCE
OVERVIEW STATEMENT

An Independent Director may remain as Independent Director after serving a cumulative term of nine (9) years,
provided that the Board recommends this upon concrete justification and after seeking its shareholders’ approval
at a general meeting. The Company has adopted the two-tier voting process in its Constitution for the retention
of any Independent Directors who have served for more than 12 years in that capacity. The Constitution of the
Company provides that at least one-third of the Directors are subject to retirement by rotation at every Annual
General Meeting (“AGM”) such that each Director shall retire from office once in every three (3) years and are
eligible to offer themselves for re-election. The Constitution also provides that a Director who is appointed during
the year shall be subject to re-election at the next AGM to be held following his appointment. The names of the
Directors seeking re-election at the forthcoming AGM are disclosed in the Notice of AGM dated 30 April 2024.

3. Nomination and Remuneration Committee

The NRC comprises three (3) Non-Executive Directors, with two (2) of them being Independent Directors.
Tan Sri Asmat bin Kamaludin, an Independent Non-Executive Director, is the Chairman of the NRC, and the
other members are Ms Chin Min Ming and Dato’ Sri Mohammed Shazalli bin Ramly. The Terms of Reference
of the NRC are available for reference at http://www.airasiax.com.

In respect of the FYE 2023, the following activities were undertaken by the NRC:-

(a) Re-election of Directors who retire by rotation pursuant to the Company’s Constitution.

(b) Review of performance of the Board of Directors, Board Committees, and individual Directors, including
an assessment of the independence of the Independent Directors.

(d) Review of the composition of the Board and its Committees.

4. Board Effectiveness Evaluation

The Board had conducted an evaluation in April 2024. As the majority of the Board members are fairly new,
the Board conducted another assessment on the performance of the Board as a whole, Board Committees,
and individual Directors in the beginning of the year 2024. The Chairman of the NRC oversaw the overall
evaluation process while the responses were reviewed and analysed by the NRC before the assessment was
tabled and communicated to the Board. During the assessment, each Director was assessed whether he/she
was able to contribute to the discussions at the Board and Board Committee meetings. Overall, the Board
was satisfied with the commitment of the Directors and the time contributed by each of them.

92 AirAsia X Berhad
CORPORATE GOVERNANCE
OVERVIEW STATEMENT

5. Professional Development of Directors

In line with Paragraph 15.08 of the MMLR, the Directors recognise the importance and value of continuous professional
development to keep themselves abreast with the changes in the aviation industry, as well as new statutory and
regulatory requirements. The Directors attended and participated in training programmes, conferences and
seminars that covered the areas of corporate governance, finance, global business developments and relevant
industry updates, which enabled them to discharge their duties effectively. The details of training programmes,
conferences and seminars attended by the Directors during the FYE 2023 are outlined below:

Names Programmes
Dato’ Fam Lee Ee • Forum “Malaysia-China Economic Development Cooperation 2023”, 25 March 2023
(Non-Independent • National Economics Forum 2023, 18 May 2023
Non-Executive • Cybersecurity Briefing, 30 March 2023
Director) • Henan (China) – Malaysia Fair for Economy & Trade, 9 June 2023
• 1st International ESG Forum 2023 “Cultivation & Practices Towards Sustainability”,
27 June 2023
• AirAsia Sustainability Day 2023, 27 June 2023
• 21st Century Maritime Silk Road Expo Promotion Conference, 14 July 2023
• Airasia Safety Workshop, 10 August 2023
• Green Investment Towards A Circular Economy Conference, 15 August 2023
• Exploring Blockchain in Legal Industry by Chainalysis, 27 September 2023
• Khazanah Megatrend Forum 2023 “Chinese New Economy and Globalisation –
The Sequel by Dr. Eric Li”, 1 October 2023
• International Commercial Dispute Prevention & Settlement Organisation
(ICDPASO) Council Meeting, 9 November 2023
• Paris Airshow, 17-20 June 2023
Datuk Kamarudin bin • IFoA Asia Conference 2023, 25 September 2023
Meranun • Cyber Resilience Training by Phished Academy (Passed for bronze level),
(Non-Independent 6 October 2023
Non-Executive • BizJihad Forum (Panelist), 14 November 2023
Director)
Tan Sri Asmat bin • PNB Acknowledge Forum 2023, 27 July 2023
Kamaludin • YTL Directors Guide to Machine Learning and AI Online Training, 3 April 2023
(Independent
Non-Executive
Director)
Chin Min Ming • Mandatory Accreditation Programme (MAP), 7 & 8 March 2023
(Independent • A 60-Minute Crisis Management – A Guide for Board Members, 22 March 2023
Non-Executive • Board Audit Committee Dialogue & Networking: A Serious Allegation Is Reported
Director) – What Should Boards Do?, 6 June 2023
• SBTi Symposium 2023: An Evidence-Based Blueprint for Climate Action,
6 June 2023
• Board Sustainability Committee Dialogue & Networking: The ABC Soup of ESG
and You (Boards), 10 July 2023
• Navigating the Rising Tide of Financial Crime & Technology, 8 September 2023
• The Cooler Earth Sustainability Summit 2023, 11 & 12 September 2023:
- Masterclass 1: The Critical Role of the Board in Accelerating Sustainability
- Masterclass 2: Integrating Sustainability into Financial Planning and
Decision-Making
- Masterclass 3: Getting Your Business to Operational Net Zero
- Masterclass 4: Global Supply Chain Regulations and How ASEAN Businesses
Will Be Impacted

2023 Annual Report 93

CORPORATE GOVERNANCE
OVERVIEW STATEMENT

Names Programmes
Dato’ Sri Mohammed • Chief Judge for CMO award from 1 December 2023 to 9 December 2023 and
Shazalli bin Ramly 6 February 2023
(Independent • Penjana Talk (Stories Revisited with Dato’ Sri Shazalli Ramly Fireside) chat between
Non-Executive Dato’ Sri Shazalli Ramly and moderated by En. Taufiq Iskandar, CEO, PKSB
Director) • Al-Ascend Malaysia 2023 by Accenture Malaysia
Dato’ Abdul Mutalib • Section 17A of MACC Act 2009 Training, 23 November 2023
bin Alias
(Independent
Non-Executive
Director)

6. Remuneration

The Board has established a formal and transparent process for approving the remuneration of the Board and
Board Committees, and the Senior Management of the Company. The NRC is responsible for formulating and
reviewing the remuneration policies for the Board and Board Committees as well as the Senior Management of
the Company to ensure the same remain competitive, appropriate, and in alignment with the prevalent market
practices. The Company’s remuneration policy is available on the Company’s website at http://www.airasiax.com.

The following table shows the remuneration details of the Directors of the Company during the
FYE 2023:-

Directors Attendance
Fees Other Fees Salaries Bonuses Fees Total
(RM) (RM) (RM) (RM) (RM) (RM)
Dato’ Fam Lee Ee 207,358 - - - 18,000 225,359
(Non-Independent
Non-Executive Director)
Datuk Kamarudin 85,000 - - - 7,000 92,000
bin Meranun
(Non-Independent
Non-Executive Director)
Tan Sri Asmat bin 171,649 - - - 14,000 186,649
Kamaludin
(Independent
Non-Executive Director)
Chin Min Ming 115,917 - - - 18,000 131,917
(Independent
Non-Executive Director)
Dato’ Sri Mohammed 21,722 - - - 2,000 23,722
Shazalli bin Ramly
(Independent
Non-Executive Director)
Dato’ Abdul Mutalib 24,278 - - - 2,000 26,278
bin Alias
(Independent
Non-Executive Director)

94 AirAsia X Berhad
CORPORATE GOVERNANCE
OVERVIEW STATEMENT

Directors Attendance
Fees Other Fees Salaries Bonuses Fees Total
(RM) (RM) (RM) (RM) (RM) (RM)
Board members who ceased their services during the financial period
YM Tunku Dato’ Mahmood 203,875 - - - 13,000 145,847
Fawzy bin Tunku
Muhiyiddin
- Resigned effect from
15 December 2023
Ahmad Al Farouk bin 130,847 - - - 15,000 145,847
Ahmad Kamal
- Resigned with effect from
15 December 2023
Notes:
• Non-Executive Directors’ Fees – Chairman (RM165,000 per annum), Members (RM65,000 per annum)
• Audit Committee Fees – Chairman (RM40,000 per annum), Members (RM30,000 per annum)
• Other Board Committees’ Fees – Chairman (RM30,000 per annum), Members (RM20,000 per annum)
• Board/Board Committees’ Meeting Allowance – RM1,000 per attendance

7. Limits of Authority

The Company has a Limits of Authority (“LOA”) manual, which defines the decision-making limits of each level
of Management within the Group. The LOA manual clearly outlines matters over which the Board reserves
authority and those delegated to the Senior Management. These limits cover, amongst others, authority
over payments, investment, capital and revenue expenditure spending limits, budget approvals and contract
commitments, as well as authority over non-financial matters. The LOA manual provides a framework of
authority and accountability within the Company and facilitates decision-making at the appropriate level in
the organisation’s hierarchy.

PRINCIPLE B
EFFECTIVE AUDIT AND RISK MANAGEMENT

1. Audit Committee

The AC comprises four (4) Independent Non-Executive Directors. It is chaired by Encik Ahmad Al Farouk
bin Ahmad Kamal, who is an Independent Non-Executive Director, and he is not the Chairman of the Board.
On 15 December 2023, Encik Ahmad Al Farouk bin Ahmad Kamal resigned as AC Chairman. In compliance
with Paragraph 15.19 of the Main Market Listing Requirements, the Board has appointed the AC committee
member, Dato’ Abdul Mutalib bin Alias as the new Chairman of the AC on 23 January 2024.

The Company has a policy which requires a former key audit partner to observe a cooling off period of at
least two (2) years before being appointed as a member of the AC. During the FYE 2023 , no member of the
AC was a former key audit partner.

In the annual assessment of the suitability, objectivity and independence of the external auditors, the AC is
guided by the factors as prescribed under Paragraph 15.21 of the MMLR as well as the Company’s External
Auditor Independence Policy.

The term of office and performance of the AC and each of its members is reviewed annually to ensure the
Chairman and members of the AC are financially literate and are able to carry out their duties in accordance
with the Terms of Reference of the AC. The AC members are expected to update their knowledge continuously
and enhance their skills.

The Board is satisfied that the Chairman and members of the AC have discharged their responsibilities
effectively. The AC’s report is set out on pages 107 to 109 of the Annual Report 2023.

2023 Annual Report 95

CORPORATE GOVERNANCE
OVERVIEW STATEMENT

2. Risk Management Committee

The RMC of the Company comprises three (3) Non-Executive Directors with two (2) of them being Independent
Directors. The RMC is chaired by Ms Chin Min Ming, who is an Independent Non-Executive Director. The RMC
enables the Board to undertake and evaluate key areas of risk exposures. The primary responsibilities of the
RMC are as follows:

• To oversee and recommend the Enterprise Risk Management (“ERM”) strategies, frameworks, policies
and procedures in identifying and managing risks within the Group;
• To review and recommend appropriate sustainability strategies, policies, principles and practices to the
Group; and
• To oversee the implementation of information security on cyber-risks and data protection of the Group.

The ERM framework provides a standardised and systematic approach for the process of identifying, evaluating,
monitoring and reporting risks faced by the Group for the FYE 31 December 2023. The Framework is aligned
with the ISO 31000:2018 Risk Management Guidelines. The Framework also enables the Management to
effectively deal with uncertainties and opportunities, enhancing the capacity to build value to the stakeholders.

The Group has established a structured process for risk management and reporting within the ERM framework
as follows:

• The first line of defence is provided by Management and departments which are accountable for identifying
and evaluating risks under their respective areas of responsibilities
• The second line of defence is provided by the RMD and RMC which are responsible for facilitating and
monitoring risk management processes and reporting
• The third line of defence is provided by the IAD which provides assurance on the effectiveness of the
ERM framework

Based on the performance evaluation for the RMC, the Board is satisfied that the Chairman and members of
the RMC have discharged their responsibilities effectively.

The Statement on Risk Management and Internal Control is set out on pages 98 to 106 of the Annual Report 2023.

96 AirAsia X Berhad
CORPORATE GOVERNANCE
OVERVIEW STATEMENT

PRINCIPLE C
INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS

1. Effective Communication with Shareholders and Investors

The Company is committed to communicating openly and regularly with shareholders and investors through
platforms such as the corporate section of its website, the Annual Report, Financial Announcements and Key
Operating Statistics and Announcements through Bursa Securities and AGMs. The Investor Relations page
of its corporate website is updated regularly to provide stakeholders with all relevant information on the
Company to enable them to make an informed decision. The Company has a dedicated Investor Relations
team which supports the Senior Management in their active participation in investor relations activities,
including road shows, conferences and quarterly investor briefings locally and globally with financial analysts,
institutional investors and fund managers. The Company continues to fulfil its disclosure obligations as per
Bursa Securities’ Corporate Governance Guidelines. All disclosures of material corporate information are
disseminated in an accurate, clear and timely manner via Bursa Securities announcements.

2. Annual General Meeting (“AGM”)

The AGM is another important forum for interaction with this group of stakeholders. All shareholders will be
notified of the meeting and provided with a digital copy of the Annual Report at least 28 days before the
meeting. At the 16th AGM of the Company held on 8 June 2023, all members of the Board were present to
respond to questions raised by the members of the meeting. The voting process at the 16th AGM was conducted
through an electronic poll voting system and scrutinised by an independent scrutineer. The Company will
continue to leverage technology to enhance the quality of its shareholder engagement and facilitate further
participation by shareholders at the Company’s AGMs.

This Corporate Governance Overview Statement was approved by the Board of the Company on 30 April 2024.

2023 Annual Report 97

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL
As part of our corporate governance and in line with best practices, AirAsia X Berhad (“AirAsia X” or
“the Company”) and the subsidiaries of AirAsia X (“the Group”) are committed to maintaining a comprehensive
and robust risk management and internal control system. The Board of Directors (“the Board”) of AirAsia X is
guided by the requirements set out within Paragraph 15.26(b) of the Main Market Listing Requirements (“MMLR”)
of Bursa Malaysia Securities Berhad (“Bursa Securities”) as well as the Malaysian Code on Corporate Governance
released by the Securities Commission Malaysia. The following statement outlines the nature and scope of Group’s
internal controls and risk management framework for the 12-month financial year ended 31 December 2023
(“FYE 2023”).

RESPONSIBILITIES OF THE BOARD

The Board is committed to implementing and maintaining a robust risk management and internal control
environment and is responsible for the system of risk management and internal control. The Board acknowledges
that the risk management and internal control systems are designed to manage and minimise risks as it may not
be possible to totally eliminate the occurrence of unforeseeable circumstances or losses.

AUDIT COMMITTEE
The Audit Committee (“AC”) monitors the adequacy and effectiveness of the system of internal controls through
a review of the results of work performed by the Internal Audit Department (“IAD”) and External Auditors and
discussions with Senior Management.

The AC, established by the Board, comprises three (3) Independent Non-Executive Directors. The AC Report is
disclosed on pages 109 to 111 of this Annual Report.

The duties and responsibilities of the AC are set out in its Terms of Reference which is available on AirAsia X’s
corporate website at https://www.airasiax.com/misc/AAX_TOR_AC_2023.pdf

RISK MANAGEMENT COMMITTEE

The Board has delegated the governance of the Group’s risk to the Risk Management Committee (“RMC”). In
May 2023, the Board approved the revised RMC’s Term of Reference (“TOR”) to oversee sustainability related
matters. The RMC of the Company comprised two (2) Independent Non-Executive Directors and one (1)
Non-Independent Non-Executive Director as at 31 December 2023.

The RMC enables the Board to undertake and evaluate key areas of risk, sustainability and cyber security
exposures. The primary responsibilities of the RMC are as follows:
• To oversee and recommend the Enterprise Risk Management (“ERM”) strategies, frameworks, policies and
procedures in identifying and managing risks within the Group;
• To review and recommend appropriate sustainability strategies, policies, principles and practices to the
Group; and
• To oversee the implementation of information security on cyber-risks and data protection of the Group.

The duties and responsibilities of the RMC are set out in its Terms of Reference which is available on AirAsia X’s
corporate website at https://www.airasiax.com/misc/2023_AAX_RMC_TOR.pdf.

In fulfilling its responsibilities in risk management, the RMC is assisted by the Risk Management Department
(“RMD”), Sustainability Department and Information Security Department.

THE MANAGEMENT
The management team is responsible for ensuring the effective implementation of policies and procedures on
risk and internal control. The management is also accountable for identifying, evaluating, and monitoring the
risks that may impede the Group’s goals and objectives.

98 AirAsia X Berhad
STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

RISK MANAGEMENT DEPARTMENT (“RMD”)

RMD assists the RMC in discharging risk management responsibilities. The RMD develops risk policies, provides
guidance on risk related matters, and coordinates risk management activities with other departments. The RMD
is also responsible to identify, monitor and inform RMC of critical risks faced by the Group. Training and workshop
is a continuous initiative by RMD to educate employees on risk management.

INTERNAL AUDIT DEPARTMENT (“IAD’’)

The IAD regularly reviews the AirAsia X’s systems of internal controls and evaluates the adequacy and effectiveness
of the controls, risk management and governance processes implemented by Management. It integrates a
risk-based approach in determining the auditable areas and frequency of audits. The annual audit plan for AirAsia X’s
is reviewed and approved by the AC.

IAD is guided by its Internal Audit Charter that provides independence and reflects the roles, responsibilities,
accountability and scope of work of the department. For any significant gaps identified in the governance
processes, risk management processes and controls during the engagements, IAD provides recommendations
to Management to improve their design and effectiveness of controls where applicable. The IAD’s functions are
disclosed in the AC Report on pages 109 to 111 of this Annual Report.

ENTERPRISE RISK MANAGEMENT FRAMEWORK

The ERM framework provides a standardised and systematic approach for the process of identifying, evaluating,
monitoring and reporting risks faced by the Group for the FYE 2023. The Framework is aligned with the ISO
31000:2018 Risk Management Guidelines. The Framework also enables the Management to effectively deal with
uncertainties and opportunities, enhancing the capacity to build value to the stakeholders.

The Group has established a structured process for risk management and reporting within the ERM framework
as follows:
• The first line of defence is provided by Management and departments which are accountable for identifying
and evaluating risks under their respective areas of responsibilities
• The second line of defence is provided by the RMD and RMC which are responsible for facilitating and
monitoring risk management process and reporting
• The third line of defence is provided by the IAD which provides assurance on the effectiveness of the ERM
framework

Our risk governance structure facilitates risk identification and escalation whilst providing assurance on the risks
and controls to the Board. It delineates and assigns distinct roles and responsibilities across all lines of defence,
facilitating the integration of the updated Enterprise Risk Management (“ERM”) Framework.

BOARD
EXTERNAL ASSURANCE PROVIDERS

SENIOR MANAGEMENT RMC AUDIT COMMITTEE

EXTERNAL AUDITOR

BUSINESS VERTICALS RISK MANAGEMENT INTERNAL AUDIT

REGULATOR

Risk Taker / Owners Risk Governance Risk Assurance

1st Line of Defence 2nd Line of Defence 3rd Line of Defence
• P rovision of products/services to • S et directions, define policy, • Independently challenge to the
customers provide assessment and develop levels of assurance provided by
• Day-to-day risk management risk management framework business operations and oversight
decision-making • Oversight the level of risk and functions
• Continuous risk identification, appetite in the organisation • R ev i e w a p p r o p r i a t e n e s s
assessment, mitigation, monitoring • I ndependent reporting and effectiveness and adequacy of
and management escalation to the Board and RM the risk management framework
• Compliance to regulatory and • Review and challenge 1st Line of
internal policies Defence

2023 Annual Report 99

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

A universally accepted risk management process has been established to ensure a standardised and consistent
approach to risk management activities across the Group. This involves the application of policies and procedures
to identify, analyse, and respond to risks in order to minimise uncertainties and maximise opportunities. The risk
management process in the Group is depicted in the diagram below, aligned with ISO 31000 Standards.

RISK RISK RISK RISK RISK

IDENTIFICATION ASSESSMENT CONTROL MONITORING REPORTING

RISK MANAGEMENT INITIATIVES

Enhancement of ERM Policy and Framework
The review of the ERM Policy and Framework was initiated in collaboration with our affiliate. The enhancement
includes the yearly review of the policy. The policy review has been finalised with approval by the Board in
August 2023.

Enhancement of Anti-Bribery and Anti Corruption (“ABAC”) Policy

The review of the ABAC Policy was initiated in collaboration with our affiliate. The enhancements are to provide
a comprehensive with clear guidelines and improved process in managing bribery and corruption within the
organisation. It is to ensure strict compliance and adherence with this ABAC Policy. The policy is now subject
to a mandatory review every three years. The policy review has been finalised with approval by the Board in
November 2023.

Automating the Risk Management process

To ensure a systematic approach in managing risk data, the implementation of the risk management system,
RedRadar, will enable the Group to utilise a single risk repository system to capture more accurate risk data and
facilitate access to up-to-date risk information. The automation also ensures consistency in risk management
practices with our affiliate.

Risk awareness session

Risk awareness sessions were conducted for Management and key personnel from respective departments. This
is to ensure that the risk processes are reasonably understood and the personnel involved are able to identify
and assess the risks and opportunities. The awareness sessions also covered Business Continuity Management
(“BCM”) and Compliance Risk Management (“CRM”) to spread awareness on both key areas that are part of risk
management.

This will be a continuous effort by RMD to enhance the approach to addressing the key areas of the ERM Policy
and Framework and to engage with respective risk owners to address gaps in their understanding of the subject
matter.

100 AirAsia X Berhad

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

KEY RISKS
Effective risk management can help mitigate uncertainties and enhance stakeholder confidence. By embedding
the risk management process within the organisation, the Group is better equipped to navigate uncertainties and
enhance stakeholder trust and assurance.

Key risks that the AirAsia X continues to track closely are as follows:

RISK MITIGATION
Financial risk AirAsia X actively monitors and manages its exposure
The Group’s operations carry certain financial risks, to fuel price volatility and imposes fuel surcharges
including the effects of changes in jet fuel prices, based on the length of flight hours.
foreign currency exchange rates, interest rates and the
market value of financial investments, credit risks as Currency exposures are managed through natural
well as liquidity risk. hedges that arise when payments for foreign currency
are matched against receivables denominated in the
same foreign currency, or whenever possible, by
intra-group arrangements and settlements.

Liquidity and cash flow risks are managed through

daily bank balance monitoring and weekly cash flow
reviews and projections.

Further details of the Group Financial Management

Policies are in notes to financial statements, Note 38
Financial Risk Management Policies on pages 89 to 95
respectively.
Business recovery risk AirAsia X mitigates this risk by strengthening its route
Intensified competition among airlines may lead network, focusing on the most popular historically
to unpredictable demand patterns as the Group proven routes and expanding into greenfield markets
competes for market share through pricing strategies to achieve “first entrant” incentives e.g., lower airport
and service enhancements. Concurrently, economic charges and strong time slots to deliver competition
fluctuations, including GDP growth and employment and secure market share by adding frequencies where
rates, can directly influence consumer travel there is solid demand and by offering competitive
behaviours. fares on routes through dynamic pricing.
People risk All nominated post holders must be approved by
Talent retention and recruitment present significant CAAM. These employees are responsible for managing
risks given the reliance on skilled crew members for and supervising different areas within a commercial
safe and efficient Group operations. The shortage airline.
or turnover of pilots, cabin crew, ground staff and
nominated post holders can disrupt operations, To ensure efficient operations, manpower planning is
jeopardising safety standards and customer conducted annually. Measures for talent retention are
satisfaction. taken through employee engagement activities, such
as town hall meetings, dialogues with employees, and
peer support programs.

2023 Annual Report 101

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

RISK MITIGATION
Safety, health and security risks AirAsia X Safety Review Board (“SRB”) oversees safety
Increasing exposure to operational safety hazards and performance, through quarterly meetings, to ensure
risks as AirAsia X grows its routes, flights and passenger safety targets are met and that the highest safety and
volume. quality standards are upheld across the Group.

AirAsia X’s Corporate Safety Department established a

standardised process to manage the risk to an As Low
As Reasonably Practicable (“ALARP”) level via robust
Safety Management System.

Established a comprehensive safety programme to

promote a safety culture among employees, with tailored
awareness initiatives across the Group.

The Corporate Safety Department is also subject to routine

mandatory audits by local civil aviation authorities which
issue operating licences to airline operating companies.
In addition, both AirAsia X and Thai AirAsia X Co., Ltd
have completed the IATA Operational Safety Audit
(“IOSA”) and obtained IOSA certification accordingly as
the global benchmark for upholding the highest safety
standards at all times.
Operational disruption risk On the supply chain issue, engagement and negotiation
The supply chain issue on aircraft components and parts with the suppliers are crucial to ensure AirAsia X can
could potentially lead to aircraft being grounded and secure the components and parts.
affect the aircraft availability.
AirAsia X mitigates failure in airport services by monitoring
Failure in airport services such as airport fuelling systems, and communicating any potential service disruption to
baggage handling systems or customs, immigration and service providers to prevent or ensure minimal disruption
quarantine processing may lead to significant delays to operations.
and business disruption.
AirAsia X has also tested incident-specific business
continuity plans in collaboration with other AOC.
Sustainability risk AirAsia X ensures compliance with all environmental
Non-compliance to sustainability requirements by regulatory requirements, including managing the potential
regulatory authorities as the airlines face pressure to put impact of environmental-related schemes such as the
in place a sustainability roadmap. Greenwashing gains Carbon Offsetting & Reduction Scheme for International
traction by the NGOs where the Group has to be careful Aviation (“CORSIA”).
on making any statement related to the environment.
On the greenwashing, seek the Legal department and
Group Sustainability review/opinion on any marketing
or statement related to sustainability before releasing
it to the public.

102 AirAsia X Berhad

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

RISK MITIGATION
Regulatory and compliance risks AirAsia X mitigates this risk by maintaining a high level
Litigation risk arising from potential breach of local of engagement with local regulators and authorities to
laws and regulations, contracts, industry guidelines and ensure any new regulatory requirement is understood
regulator/consumer authority requirements in multiple and swiftly adhered to.
jurisdictions.
The Group also constantly monitors the local regulatory
Compliance with Anti-bribery and anti-corruption landscape for new or amended regulations affecting
Malaysian Anti-Corruption Act 2009 (MACC Act 2009). the Group.

The Group has put in place Anti-Bribery and Anti-Corruption

Policy, which has been disseminated to all internal and
to all external parties that conduct business transactions
with the Group. All internal need to acknowledge their
awareness of this policy.

The policy is available on AirAsia X’s corporate website:

https://www.airasiax.com/misc/AAX_ABAC_Policy.pdf
Information security risk The Group has a dedicated information security team
Cyber security risk arising from heavy focus on online that focuses on detecting, containing, and remediating
sales channels, guest feedback, help channels and other cyber threats, headed by the Group’s Chief Information
digital solutions. Security Officer (“CISO”).

Violation of data privacy laws and regulations and loss Continuous initiatives include updating to new standards
of customer confidence due to a data breach. ISO 27001:2022, external threat/risk monitoring, improved
SuperApp account and payment protections, network
upgrades by ICT, and incident management. In addition,
to instill information security awareness culture, employee
education and awareness programs including online
training campaigns are compulsory for Allstars.

The Group has established a data governance framework

and a data security & privacy working group to review
existing policies and ensure compliance with laws,
regulations, and best practices.
Reputation and branding risks AirAsia X mitigates this risk by conducting ongoing real
Reputational damage stemming from adverse media time media monitoring, social media monitoring and
publicity or social networks that serve as platforms customer sentiment monitoring to enable quick action
for airing consumer grievances or anti-organisation and response to all stakeholder communication channels.
campaigns.
A dedicated AirAsia X team is established to ensure
necessary and effective response to mitigate any
potential brand and reputational threat.

2023 Annual Report 103

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

INTERNAL CONTROL FRAMEWORK

The following key internal control structures (including the AC and the IAD disclosed above) are in place to assist
the Board to maintain a proper internal control system:

Board Governance
The Board has governance over the Group’s operations. The Board is kept updated on the Group’s activities and
operations on a timely and regular basis through Board meetings with a formal agenda on matters for discussion.
The Board of AirAsia X has established four (4) committees, namely the AC, RMC, Nomination and Remuneration
Committee and SRB, to assist it in executing its governance responsibilities. Further information on the various
Board Committees is provided in the Corporate Governance Overview Statement from pages 90 to 99 of this
Annual Report.

Senior Management Responsibilities

Regular management and operations meetings are conducted by Senior Management, which comprises the
Chief Executive Officer (“CEO”), Chief Financial Officer (“CFO”) and Heads of Department.

The Board of our associated company includes our representatives. Information on the financial performance of
our associated company is provided regularly to the Management and Board of AirAsia X via regular management
reports and presentations at Board meetings.

In respect to the joint venture entered into by the Group, the Management of the joint venture, which consists of
representatives from the Group and other joint venture partners, are responsible to oversee the administration,
operation and performance of the joint venture. Financial and operational reports of the joint venture are
provided regularly to the Management of AirAsia X.

Culture
The Board believes that good governance reflects the culture of an organisation. This is more significant than any
written procedures. The Group aims at all times to act ethically and with integrity, and to instil this behaviour in
all its employees by example from the Board down.

As provided in AirAsia X’s Code of Business Conduct, AirAsia X is committed to uphold high standards of
business ethics in all aspects of its business and expects the same within its relationships with all those with
whom it engages and does business with.

AirAsia X also has a Code of Conduct (“the Code”) which governs the conduct of its employees, officers and
directors. The Code sets out the standards and ethics that they are expected to adhere to. It highlights AirAsia X’s
expectations on their professional conduct which includes:
• The environment inside and outside of workplace
• The working culture
• Conflict of interest
• Confidentiality and disclosure of information
• Good practices and controls
• Duty and declaration

The Code also sets out the circumstances in which an employee, officer and director would be deemed to have
breached the Code after due inquiry and disciplinary actions that can be taken against them if proven guilty.

Segregation of Duties
Segregation of duties is embedded in the key business processes. The Group has in place a system to ensure
there are adequate risk management, financial and operational policies and procedures.

Internal Policies and Procedures

Policies, procedures and processes governing the Group’s businesses and operations are documented and readily
made available to employees across the Group on the AirAsia X’s intranet portal. These policies, procedures and
processes are reviewed and updated by the business and functional units through a structured and standardised
process of review. This is to ensure that appropriate management controls are in place to manage risks arising
from changes in legal and regulatory requirements as well as the business and operational environment.

104 AirAsia X Berhad

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

Financial Budgets
A detailed budgeting process has been established requiring all Heads of Department to prepare budgets and
business plans annually for deliberation and approval by the Board. In addition, AirAsia X has a reporting system
on actual performance against the approved budgets, which requires explanations for significant variances and
plans by Management to address such variances.

Human Resource Management

AirAsia X acknowledges that a robust risk management and internal control system is dependent on its employees
applying responsibility, integrity and good judgement to their duties. As such, AirAsia X has in place policies
and procedures that govern its recruitment, appointment, performance management, compensation and reward
mechanisms as well as policies and procedures that govern discipline, termination and dismissal of employees
and ensures compliance of the same with all applicable laws and regulations.

Limits of Authority
AirAsia X documented its Limits of Authority (“LOA”) clearly defining the level of authority and responsibility
in making operational and commercial business decisions. Approving authorities cover various levels of
Management and the Board. The LOA is reviewed regularly and any amendments made must be tabled to and
approved by the Board.

Insurance
The Group maintains adequate insurance and physical safeguards on assets to ensure these are sufficiently
covered against any incident that could result in material losses. Specifically, AirAsia X maintains its Aviation
Insurance which provides coverage for the following:
• Aviation Hull and Spares All Risks and Liability
• Aviation Hull and Spares War and Allied Perils (Primary and Excess)
• Aircraft Hull and Spares Deductible
• Aviation War, Hijacking and other Perils Excess Liability (Excess AVN52)

AirAsia X also maintains adequate general insurance to mitigate other risks and financial losses arising from fire,
burglary, employee fidelity, public liability, and loss of cash in transit.

Information Security
The Information Security Department and Chief Information Security Officer (“CISO”) are the process owners of
all assurance activities related to Confidentiality, Integrity, and Availability of the company, employee, customer,
business partners, and the business information; in line with the company’s objectives by establishing the
information security policies for the entire group. The Information Security team and CISO work with executive
management to establish, implement, and maintain information security management programmes to ensure
information assets are adequately protected.

Information Security: Protecting the environment from the potential threats that could compromise privacy,
productivity, reputation and intellectual property rights of information resources and users.

Data Governance: Outlines how business activity monitoring should be carried out to ensure organisational
data is accurate, consistent and protected. Defines the roles and responsibilities for information management.
Specifies procedures to be used in managing different types of data.

Access Control: Outlines access controls across the Group’s networks, information systems and services to provide
authorised, granular, auditable and appropriate user access, and to ensure appropriate preservation of data
confidentiality, integrity and availability. Protects the interests of all authorised users of the Group’s information
systems, as well as data provided by third parties, by creating a safe, secure and accessible environment in which
to work.

Server, Database and Networks: Establish rules and procedures for hardening servers, database and network
equipment to: a) create a security baseline for all servers, database and network equipment across the Group; b)
minimise server and IT-related risks; c) comply with regulatory requirements.

2023 Annual Report 105

STATEMENT ON RISK MANAGEMENT
& INTERNAL CONTROL

Information Security Testing: Give assurance of the adequacy of security controls by coordinating security
reviews through vulnerability assessment and penetration testing (“VAPT”) of the Group’s IT infrastructure,
network and web applications.

Information Security Detection and Incident Response: Ensures operations recover quickly from information
security incidents, minimising loss of information and disruption of services. Protects the Group’s reputation
and minimises loss of credibility among customers. Provides technical guidelines on responding to incidents
effectively and efficiently.

Whistleblowing Policy
AirAsia X has in place a Whistleblowing Policy which provides a platform for employees or third parties to report
instances of unethical behaviour, actual or suspected fraud or dishonesty, or a violation of AirAsia X’s Code of
Conduct. It provides protection for the whistle-blowers from any reprisals as a direct consequence of making
such disclosures. It also covers the procedures for disclosure, investigations and the respective outcomes of such
investigations. AirAsia X expects its employees to act in AirAsia X’s best interests and to maintain high principles
and ethical values. AirAsia X will not tolerate any irresponsible or unethical behaviour that would jeopardise its
good standing and reputation.

Conclusion
The Board has received assurance from the CEO and CFO of AirAsia X that AirAsia X’s risk management and
internal control system are operating adequately and effectively in all material aspects. For areas which require
improvement, action plans are being developed with implementation dates being monitored by the respective
Heads of Department. The Board also receives updates on key risk management and internal control matters
through its Board Committees. Based on assurance received from Management and updates from the Board
Committees, the Board is of the view that the Group’s risk management and internal control systems were
operating adequately and effectively during the FYE 2023 and up to the date of approval of this statement.
There were no material control failures or adverse compliance events that have directly resulted in any material
loss to the Group.

AirAsia X’s associate company is in the process of fully adopting AirAsia X’s risk management and internal
controls. The disclosure in this statement does not include the risk management and internal control practices of
AirAsia X’s material joint venture.

Review of the Statement by External Auditors

As required by Paragraph 15.23 of the MMLR of Bursa Securities, the External Auditors have reviewed this
Statement on Risk Management and Internal Control. Their limited assurance review was performed in accordance
with the Audit and Assurance Practice Guide 3 (“AAPG 3”) issued by the Malaysian Institute of Accountants. The
AAPG 3 does not require the External Auditors to form an opinion on the adequacy and effectiveness of the risk
management and internal control systems of the Group.

The External Auditors have reviewed this Statement on Risk Management and Internal Control for the FYE 2023,
in compliance with paragraph 15.23 of the Listing Requirements in accordance with guidelines issued by the
Malaysian Institute of Accountants and reported to the Board that nothing has come to their attention to cause
them to believe that the statement intended to be included in the Annual Report is not prepared, in all material
respects, in accordance with disclosures required by Paragraph 41 and 42 of the Statement on Risk Management
and Internal Control: Guidelines for Directors of Listed Issuer, or that the statement is factually inaccurate. Their
limited assurance review was performed in accordance with the AAPG 3 issued by the Malaysian Institute of
Accountants. The AAPG 3 does not require the External Auditors to form an opinion on the adequacy and
effectiveness of the risk management and internal control systems of the Group.

This statement is in accordance with the resolution of the Board of Directors of AirAsia X on 30 April 2024.

106 AirAsia X Berhad

AUDIT COMMITTEE
(“AC”) REPORT
This report outlines the activities of the AC of AirAsia X Berhad (“AirAsia X” or “the Company”) for the financial
year ended 31 December 2023 (“FYE 2023”).

This report has been reviewed by the AC and approved by the Board of Directors (“the Board”) of AirAsia X on
30 April 2024 for inclusion in this Annual Report.

The AC assists the Board in fulfilling its duties with respect to its oversight responsibilities over AirAsia X and the
subsidiaries of AirAsia X (“the Group”). The AC is committed to its role of ensuring the integrity of the financial
reporting process; the management of risks and systems of internal controls, external and internal audit processes
and compliance with legal and regulatory matters; and the review of related party transactions and other matters
that may be specifically delegated to the AC by the Board. The AC’s responsibility for the internal audit of the
Group is fulfilled through reviews of the quarterly and other reports of the Internal Audit Department (“IAD”).

A. Composition of AC

The AC is established by the Board and comprises (4) Independent Non-Executive Directors, including
the Chairman and none of them are an alternate director. The Chairman of the AC, Encik Ahmad Al Farouk
bin Ahmad Kamal is appointed by the Board and is not the Chairman of the Board. He holds a Bachelor of
Science in Economics and a Master of Science in Finance and Economics. Further, he has more than 19 years
of experience in the finance and banking sector. Therefore the Company meets the Para 15.09(1)(c)(i) of the
Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa Securities”).

On 15 December 2023, Encik Ahmad Al Farouk bin Ahmad Kamal resigned as AC Chairman. In compliance
with Paragraph 15.19 of the Main Market Listing Requirements, the Board has appointed the AC committee
member, Dato’ Abdul Mutalib bin Alias as the new Chairman of the AC on 23 January 2024 and he is not
the Chairman of the Board. Dato’ Abdul Mutalib holds a Bachelor of Science in Accountancy and a Master
in Business Administration. Further, he has more than 35 years of experience in the banking sector and
government sector. Therefore, the Company meets the Para 15.09(1)(c)(i) of the MMLR of Bursa Securities.

The duties and responsibilities of the AC are set out in its Terms of Reference, which is published on AirAsia X’s
corporate website at www.airasiax.com.

B. Attendance of Meetings

A total of five (5) meetings were held during the FYE 2023 with full attendance by all AC members.

The Head of Internal Audit of AirAsia X attended the AC meetings to present the audit and investigation
reports. Representing the senior management team, the Chief Executive Officer (“CEO”) and the Chief
Financial Officer (“CFO”) were invited to attend all the AC meetings to facilitate deliberations as well as to
provide clarification on the audit issues. Where required, the management of the audit subjects was also
invited to provide an explanation to the AC on specific control lapses and issues arising from the relevant
audit reports.

2023 Annual Report 107

AUDIT COMMITTEE
(“AC”) REPORT

C. Activities of the AC for FYE 2023

In discharging its duties and responsibilities, the AC is guided by the AC Terms of Reference, which was
approved by the Board and aligned with the provisions of the MMLR, Malaysian Code on Corporate
Governance and other best practices. A summary of the work of the AC during the FYE is as set out below:

Financial Reporting
• Reviewed and deliberated on all quarterly financial results and annual audited financial statements for
recommendation to the Board for approval.
• The AC’s review focused on any change in Accounting Policies and Practices, and the implementation of
such changes; significant and unusual events; significant adjustments arising from the Audit; litigation
that could affect the results materially; the going concern assumption; compliance with Accounting
standards, other legal requirements and regulatory requirements; review and ensure corporate
disclosure policies and procedures of the Group (as they pertain to accounting, audit and financial
matters) comply with the disclosure requirements as set out in the MMLR.

External Audit
• Reviewed the external auditor’s overall work plan and recommended to the Board their remuneration,
terms of engagement and considered in detail the results of the audit, external auditor’s performance
and independence and the effectiveness of the overall audit process.
• Reviewed updates on the Malaysian Financial Reporting Standards and how they will impact the
Company and has monitored progress in meeting the new reporting requirements.
• Updated continuously by the external auditors on changes to the relevant guidelines on the regulatory
and statutory requirements.
• Deliberated and reported the results of the annual audit for recommendation to the Board.
• Met with the external auditors without the presence of the Management to discuss any matters that
they may wish to present.

Internal Audit
• Deliberated and approved the Internal Audit Plan for the FYE to ensure adequate scope and
comprehensive coverage of audit as well as to ensure the audit resources are sufficient to enable AC to
discharge its functions effectively.
• Deliberated on the investigation reports and after having understood the case in detail, directed the
Management to implement controls to strengthen the control environment and prevent recurrence.
• Reviewed the quarterly status reports on audit finding and deliberated on the rectification actions and
timeline taken by the Management to ensure the control lapses are addressed and resolved promptly.
• Reviewed the results of operational audit reports.
• Providing assistance to the appointed external auditor in all oversight of the operational audits on each
quarterly review.

Related Party Transactions

• Reviewed the related party transactions entered into by the Company and its affiliates in conformity to
the established procedures in adherence to the MMLR.

Annual Report
• Reviewed the Statement on Risk Management and Internal Control and the Corporate Governance
Overview Statement prior to their inclusion in the Company’s Annual Report.
• Further information on the summary of the AC activities in discharging its functions and duties for
the FYE and how it has met its responsibilities are provided in the Corporate Governance Report in
accordance with Practice 8.5 of the MCCG.

108 AirAsia X Berhad

AUDIT COMMITTEE
(“AC”) REPORT

D. Internal Audit Function and Summary of Work

AirAsia X has an in-house Internal Audit Department (“IAD”) to assist the AC in carrying out its functions.
IAD is guided by its Internal Audit Charter approved by AC that provides independence & reflects the
function and responsibilities of the department. IAD carries out its audits which are closely guided by the
International Professional Practices Framework issued by the Institute of Internal Auditors.

IAD reports functionally to AC and administratively to the CEO. IAD executives declare yearly that they are
free from any conflict of interest, which could impair their objectivity and independence.

The principal responsibility of IAD is to undertake regular and systematic reviews of the systems of internal
controls to provide reasonable assurance that the systems continue to operate efficiently and effectively.
IAD adopts a risk-based methodology to develop its audit plans by determining the priorities of the internal
audit activities.

The audits cover the review of the adequacy of risk management, the strength and effectiveness of internal
controls, compliance to internal statutory requirements, governance and management efficiency, among
others.

The audit reviews conducted during FYE 2023 were based on a risk-based Internal Audit Plan approved
by the AC. The main focus of the internal audit activities during the FYE 2023 was on high risk areas and
auditable areas that were critical to the Group’s business recovery to pre-pandemic levels of performances.
The main audited areas during FYE 2023 include revenue related processes such as book-to-cash control
procedures, credit card payment processes, IT and cyber security controls, revenue assurance and station
control assessment.

The audit reports which provide the results of the audit conducted, as well as key control issues and
recommendations are highlighted and submitted to the AC for review and execution. The Management is to
ensure that corrective actions are implemented within the required time frame.

The AC reviews and approves the Internal Audit’s human resource requirements to ensure that the function
is adequately resourced with a competent and proficient internal auditor. The IAD has a team of an assistant
manager and an audit executive. The Head of Internal Audit, Ms. Wong Ooi Ling was appointed in November
2020. She is a Chartered Accountant of Malaysian Institute of Accountants.

Total operational costs of the IAD for the FYE 2023 were RM570,064.

2023 Annual Report 109

ADDITIONAL COMPLIANCE
INFORMATION
The information set out below is disclosed in compliance with the Main Market Listing Requirements (“MMLR”)
of Bursa Malaysia Securities Berhad (“Bursa Securities”) for the financial year ended 31 December 2023
(“FYE 2023”) for AirAsia X Berhad (“AirAsia X” or “the Company”).

1. UTILISATION OF PROCEEDS FROM CORPORATE PROPOSAL

The Company raised a total of RM50.0 million by way of private placement of 32,258,066 new ordinary
shares in the Company, representing approximately 7.78% of the total number of issued shares. The proceeds
were fully utilised as part of the Company’s general working capital, including for aircraft activation, aircraft
maintenance, and other operating expenses such as leases and insurance.

2. MATERIAL CONTRACTS INVOLVING DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS

There was no material contracts entered into by the Company and its subsidiaries involving directors’ and
major shareholders’ interest still subsisting at the end of the FYE 2023.

3. AUDIT AND NON-AUDIT FEES

The audit and non-audit fees of the Company and its Group as below are also disclosed in the Audited
Financial Statements set out under Note 9 to the Financial Statements on page 157 of this Annual Report:-

Group Company
Audit Fees
RM’000 RM’000
Audit fees paid to the External Auditors for the 817 680
FYE 2023

Group Company
Non-Audit Fees
RM’000 RM’000
Non-audit fees paid to the External Auditors for the 2,500 2,500
FYE 2023 in connection with advisory related work

4. RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

At the Annual General Meeting (“AGM”) held on 8 June 2023, the Company had obtained a shareholders’
mandate to allow the Company to enter into recurrent related party transactions of a revenue or trading
nature (“RRPT”).

110 AirAsia X Berhad

ADDITIONAL COMPLIANCE
INFORMATION

Pursuant to paragraph 10.09(2)(b) and paragraph 3.1.5 of Practice Note 12 of the MMLR of Bursa Securities,
details of the RRPT entered into during the FYE 2023 are as follows:

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
EXPENSES
1. AirAsia Berhad Rights granted by AirAsia to our Interested RM8,308,062
(Company No.: Company to operate air services Directors
199301029930) (284669-W) under the “AIRASIA” trade name Datuk Kamarudin
(“AirAsia”) and livery in respect of our low-cost, bin Meranun
long-haul air services. (“Datuk
Kamarudin”)
Dato’ Fam Lee Ee
(“Dato’ Fam”)

Interested Major
Shareholders
AirAsia
Tune Group
Sdn Bhd
(Company No.:
200701040836)
(798868-P)
(“Tune Group”)
Tan Sri Anthony
Francis Fernandes
(“Tan Sri Tony”)
Datuk Kamarudin
2. AirAsia Berhad Provision of the following range of Interested RM7,984,880
(Company No.: services by AirAsia to our Company: Directors
199301029930) (284669-W) Datuk Kamarudin
(“AirAsia”) (a) Commercial Dato’ Fam
− Sales and distribution
− Sales support Interested Major
− Direct channel Shareholders
− Branding and Creative AirAsia
• Protection of brand to Tune Group
ensure proper public Tan Sri Tony
perception is built Fernandes
• Manage communication Datuk Kamarudin
imagery, sponsorships
(e.g. sports and
youth marketing) and
commercial branding
• Creative includes
g ra p h i c designs
supporting branding
activities
− Web team: Manage, plan,
build and develop airasia.com
website
− Digital Marketing
− Ancillary

2023 Annual Report 111

ADDITIONAL COMPLIANCE
INFORMATION

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
(b) Treasury
− Fuel procurement
− Fuel hedging
(c) Revenue Assurance - Credit card
fraud unit Internal Audits
(d) Group Inflight Ancillary
(e) Engineering
(f) Customer Support
3. Rokki Sdn Bhd Supply of in-flight entertainment Interested NIL
(Company No.: system, hardware, software, content Directors
201101006967) (935105-W) and updates by Rokki. Datuk Kamarudin
(“Rokki”) Dato’ Fam

Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
4. BIGLIFE Sdn Bhd Purchase of loyalty points from Interested RM1,238,809
(Company No.: BIGLIFE, which operates and Directors
201001040731) (924656-U) manages a loyalty program branded Datuk Kamarudin
(“BIGLIFE”) as the BIG Loyalty Program. Dato’ Fam

Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
5. Tune Insurance Malaysia Payment to Tune Insurance of Interested RM6,208,483
Berhad insurance premiums collected on Directors
(Company No.: its behalf pursuant to our Company’s Datuk Kamarudin
197601004719) (30686-K) role as a corporate agent of Tune
(“Tune Insurance”) Insurance for the provision of AirAsia Interested Major
Insure, a travel protection plan which Shareholders
provides coverage for losses arising AirAsia
from, amongst others, personal Tune Group
accident, medical and evacuation, Tan Sri Tony
emergency medical evacuation Fernandes
and mortal remains repatriation, Datuk Kamarudin
travel inconvenience such as flight
cancellation or loss or damage to
baggage and personal effects, flight
delay and on-time guarantee.

112 AirAsia X Berhad

ADDITIONAL COMPLIANCE
INFORMATION

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
6. AirAsia SEA Provision of the following shared Interested RM6,545,827
Sdn Bhd (Company No.: services by AirAsia SEA to our Directors
201301015339) (1045172-A) Company: Datuk Kamarudin
(“AirAsia SEA”) Dato’ Fam
(a) Finance and accounting support
operation services; Interested Major
(b) People department support Shareholders
operation services; AirAsia
(c) Information and technology Tune Group
operation support services; Tan Sri Tony
(d) Sourcing and procurement Fernandes
operation support services; Datuk Kamarudin
(e) Information Security;
(f) Customer Happiness; and
Operational Quality Assurance
7. Ormond Lifestyle Services Provision of food catering and Interested RM2,064,601
Sdn Bhd (Company No.: hospitality services. Directors
201601003986) (1174912-W) Datuk Kamarudin

Interested Major
Shareholders
Tan Sri Tony
Fernandes
Datuk Kamarudin
8. Ground Team Red Provision of ground handling Interested RM22,488,829
Sdn Bhd (Company No.: services at airports. Directors
200701042697) (800730-V) Datuk Kamarudin
(“GTR”) Dato’ Fam

Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
9. AirAsia (Guangzhou) Provision of operational services by Interested RM1,629,807
Aviation Service Limited AirAsia (Guangzhou) to AirAsia X Directors
(Company in China. Datuk Kamarudin
Registration No.: Dato’ Fam
91440101MA5ALG3R31)
(“AirAsia (Guangzhou)”) Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin

2023 Annual Report 113

ADDITIONAL COMPLIANCE
INFORMATION

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
10. AirAsia Com Travel Appointment of AirAsia Com as Interested RM57,824,190
Sdn Bhd (Company No.: preferred agent for flight and Directors
201301020508) (1050338-A) ancillary on airasia.com website and Datuk Kamarudin
(“AirAsia Com”) applications, where AirAsia Com Dato’ Fam
will provide platform development,
technology maintenance, branding, Interested Major
digital marketing on flights Shareholders
promotion through online platform, AirAsia
and providing revenue and sales Tune Group
relevant reports and dashboard to Tan Sri Tony
AirAsia X. Fernandes
Datuk Kamarudin
11. Asia Digital Engineering Provision of resources to ensure Interested RM25,260,975
Sdn Bhd (Company No.: the smooth operations of aircraft Directors
202001010462) (1366782-X) maintenance which include Datuk Kamarudin
(“ADE”) manpower, tooling and store. Dato’ Fam

Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
12. Santan Restaurant Provision on inflight food, beverage, Interested RM15,986,440
Sdn Bhd (Company No.: merchandise and duty free products Directors
201401017641) (1093728-T) and services to AirAsia X flights. Datuk Kamarudin
(“Santan”) Dato’ Fam

Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
13. Ikhlas Com Travel Provision of sales and distribution Interested RM3,727,181
Sdn Bhd (Company No.: services for seats sold in Saudi Directors
201801010997) (1273013-P) Arabia routes Datuk Kamarudin
(“Ikhlas”) Dato’ Fam

Interested Major
Shareholders
Tan Sri Tony
Fernandes
Datuk Kamarudin

114 AirAsia X Berhad

ADDITIONAL COMPLIANCE
INFORMATION

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
REVENUE/INCOME
1. Tune Insurance Malaysia Receipt of commission income of 25% Interested RM1,617,405
Berhad (Company No.: on all insurance premiums received Directors
197601004719) (30686-K) by Tune Insurance pursuant to our Datuk Kamarudin
(“Tune Insurance”) Company’s role as a corporate agent
of Tune Insurance for the provision Interested Major
of AirAsia Insure, a travel protection Shareholders
plan which provides coverage for AirAsia
losses arising from, amongst others, Tune Group
personal accident, medical and Tan Sri Tony
evacuation, emergency medical Fernandes
evacuation and mortal remains Datuk Kamarudin
repatriation, travel inconvenience
such as flight cancellation or loss or
damage to baggage and personal
effects, flight delay and on-time
guarantee.
2. Philippines AirAsia Provision of the following Interested RM584,843
Inc. (Registration No.: commercial services by AirAsia X Directors
A199707490) (“PAA”) to PAA, including but not limited to: Datuk Kamarudin
Dato’ Fam
(1) Airport management and group
handling; and Interested Major
(2) Government and regulatory Shareholders
liaison. AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
3. Thai AirAsia Company Provision of the following Interested NIL
Limited (Company No.: commercial services by AirAsia X Directors
0105546113684) (“TAA”) to TAA, including but not limited to: Datuk Kamarudin
Dato’ Fam
(1) Airport management and group
handling; and Interested Major
(2) Government and regulatory Shareholders
liaison. AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
4. PT Indonesia AirAsia Provision of the following commercial Interested RM388,217
(Company No.: services by AirAsia X and AirAsia X Directors
30.06.1.51.07399) (“IAA”) Service Pty. Ltd. (Company No. 141 Datuk Kamarudin
326 463) to IAA, including but not Dato’ Fam
limited to:
Interested Major
(1) Airport management and group Shareholders
handling; and AirAsia
(2) Government and regulatory Tune Group
liaison. Tan Sri Tony
Fernandes
Datuk Kamarudin

2023 Annual Report 115

ADDITIONAL COMPLIANCE
INFORMATION

No. Transacting Parties Nature of RRPT Class and Actual Value

Relationship of the
Related Parties
5. BIGLIFE Sdn Bhd Revenue from ticket sales and/ Interested RM1,077,762
(Company No.: or other ancillary sales arising Directors
201001040731) (924656-U) from redemption of loyalty points Datuk Kamarudin
(“BIGLIFE”) from BIGLIFE which operates and Dato’ Fam
manages a loyalty program branded
as the BIG Loyalty Program. Interested Major
Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
6. Teleport Everywhere Novation of the Master General Interested RM151,672,944
Pte Ltd (Company No.: Cargo Sales Agent cum Management Directors
201916239W) (“Teleport Services Agreement entered into Datuk Kamarudin
Everywhere”) between AirAsia X and Teleport Dato’ Fam
Malaysia on 27 June 2018, for
Teleport Malaysia to purchase cargo Interested Major
transportation capacity on routes Shareholders
operated by AirAsia X, to Teleport AirAsia
Everywhere. Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin
7. Ikhlas Com Travel Engagement with IKHLAS as a travel Interested NIL
Sdn Bhd (Company No.: agent for sale of routes that AirAsia X Directors
2018010997) (1273013-P) is operating, except for Jeddah and Datuk Kamarudin
(“Ikhlas”) Madinah. Dato’ Fam

Interested Major
Shareholders
Tan Sri Tony
Fernandes
Datuk Kamarudin
8. AirAsia Berhad In order to improve efficiency of Interested NIL
(Company No.: the parties, wet lease arrangements Directors
199301029930) (284669-W) are to utilise the excess aircraft of Datuk Kamarudin
(“AirAsia”) AirAsia X for AirAsia to operate Dato’ Fam
those high demand routes by using
A330s with a seat capacity of 377, Interested Major
with the same flight frequency. Shareholders
AirAsia
Tune Group
Tan Sri Tony
Fernandes
Datuk Kamarudin

116 AirAsia X Berhad

ADDITIONAL COMPLIANCE
INFORMATION

The shareholdings of the interested Directors and interested Major Shareholders in our Company as at
31 December 2023 are as follows:

Direct Indirect
No. of Shares % No. of Shares %
Interested Directors
Datuk Kamarudin 37,070,993 8.29 131,033,136(1) 29.31
Dato’ Fam - - - -

Interested Major Shareholders

AirAsia 57,072,850 12.77 - -
Tune Group 73,960,286 16.54 - -
Tan Sri Tony Fernandes 11,158,722 2.50 131,033,136(1) 29.31
Datuk Kamarudin 37,070,993 8.29 131,033,136(1) 29.31

Note:
(1)
Deemed interested via their interests in AirAsia and Tune Group, being the Major Shareholders of our Company pursuant
to Section 8 of the Companies Act 2016.

Please refer to the notes of Section 2.3 of the Circulars to Shareholders dated 30 April 2024 on the directorships
and shareholdings of the interested Directors and interested Major Shareholders in the transacting parties
as stated above.

2023 Annual Report 117

DIRECTORS’
REPORT
Directors’ report

The Directors have pleasure in presenting their report together with the audited financial statements of the
Group and of the Company for the financial year ended 31 December 2023.

Principal activities

The principal activity of the Company is that of providing long haul air transportation services.

The principal activities of the subsidiaries, an associate and a joint venture companies are disclosed in Notes 18,
19 and 20 to the financial statements.

Financial results

Group Company
RM’000 RM’000

Profit for the financial year, representing profit attributable to owners of the
Company 331,505 333,072

There were no material transfers to or from reserves or provisions during the financial year other than as disclosed
in the financial statements.

In the opinion of the Directors, other than as disclosed in the financial statements, the results of the operations of
the Group and of the Company during the financial year were not substantially affected by any item, transaction
or event of a material and unusual nature other than the reversal of additional loss in an investment in a joint
venture as disclosed in Note 42 to the financial statements.

Share capital

On 15 June 2023, the Company has completed a private placement exercise, in which the Company has issued
32,258,066 new shares with an issue price of RM1.55 per placement price. The new shares rank pari passu with
the then existing shares of the Company.

Share options

No option was granted by the Company to any parties to take up unissued shares of the Company during the
financial year.

Dividend

No dividend has been paid or declared by the Company since the end of the previous financial year. The directors
do not recommend the payment of any dividend in respect of the current financial year.

118 AirAsia X Berhad

DIRECTORS’
REPORT

Directors

The names of the Directors of the Company in office since the beginning of the financial year to the date of this
report are:

Datuk Kamarudin bin Meranun

Tan Sri Asmat bin Kamaludin
Dato’ Fam Lee Ee
Chin Min Ming
Dato’ Sri Mohammed Shazalli bin Ramly (Appointed on 29 September 2023)
Dato’ Abdul Mutalib bin Alias (Appointed on 29 September 2023)
Ahmad Al Farouk bin Ahmad Kamal (Resigned on 15 December 2023)
Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin (Resigned on 15 December 2023)

The names of the Directors of the Company’s subsidiaries in office since the beginning of the financial year to
the date of this report (not including those Directors listed above) are:

Benyamin bin Ismail

Jean Marc Kin Voon Likamtin
Deans Tommy Lo Seen Chong
Kanoosingh Ashive

Directors’ benefits

Neither at the end of the financial year, nor at any time during the year, did there subsist any arrangement to
which the Company was a party, whereby the Directors might acquire benefits by means of the acquisition of
shares in or debentures of the Company or any other body corporate.

Since the end of the previous financial period, no Director has received or become entitled to receive a benefit
(other than benefits included in the aggregate amount of emoluments received or due and receivable by the
Directors or the fixed salary of a full-time employee of the Company as shown below) by reason of a contract
made by the Company or a related corporation with any Director or with a firm of which he is a member, or with
a company in which the Director has a substantial financial interest, other than as disclosed in Note 37 to the
financial statements.

The Directors’ benefits are as follows:

Group and
Company
2023 RM’000

Fees 961
Emoluments and other allowances 589
1,550

2023 Annual Report 119

DIRECTORS’
REPORT

Indemnity and insurance for Directors and officers

The Directors and officers of the Company and its subsidiaries are covered under a Directors’ and Officers’
Liability Insurance up to an aggregate limit of RM10 million against any legal liability, if incurred by the Directors
and officers of the Company and its subsidiaries in the discharge of their duties while holding office for the
Company and its subsidiaries. The insurance premium paid by the Company was RM288,416.

Directors’ interests

According to the Register of Directors’ Shareholdings, the interests of the Directors in office at the end of the
financial year in shares in the Company or its related corporations during and at the end of the financial year are
as follows:

Number of ordinary shares

Share
consolidation
1.1.2023 (Note 35) Disposed 31.12.2023

The Company

Datuk Kamarudin bin Meranun

Direct interest 37,070,994 - (1) 37,070,993
Indirect interest * 131,033,138 - (2) 131,033,136

Tan Sri Asmat bin Kamaludin

Direct interest 10,000 - - 10,000
Indirect interest ** 4,000 - (2,000) 2,000

* Deemed interest by virtue of their shareholding interests in AirAsia Berhad and Tune Group Sdn Bhd
pursuant to Section 8A of the Companies Act 2016.

** Pursuant to Section 59(11)(c) of the Companies Act 2016, the interests of spouse and children of Tan Sri
Asmat bin Kamaludin in the shares of the Company shall also be treated as the interest of Tan Sri Asmat
bin Kamaludin.

Other than as disclosed above, none of the other Directors in office at the end of the financial year had any
interest in shares in the Company or its related corporations during the financial year.

120 AirAsia X Berhad

DIRECTORS’
REPORT

Other statutory information

(a) Before the statements of comprehensive income and statements of financial position of the Group and of
the Company were made out, the Directors took reasonable steps:

(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the
making of allowance for doubtful debts and satisfied themselves that all known bad debts had been
written off and adequate allowance had been made for doubtful debts; and

(ii) to ensure that any current assets which were unlikely to realise their values as shown in the
accounting records in the ordinary course of business had been written down to an amount which
they might be expected so to realise.

(b) At the date of this report, the Directors are not aware of any circumstances which would render:

(i) the amount written off for bad debts or the amount of the allowance for doubtful debts in the
financial statements of the Group and of the Company inadequate to any substantial extent; and

(ii) the values attributed to the current assets in these financial statements of the Group and of the
Company misleading.

(c) At the date of this report, the Directors are not aware of any circumstances which have arisen which
would render adherence to the existing method of valuation of assets or liabilities of the Group and of the
Company misleading or inappropriate.

(d) At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in
this report or the financial statements of the Group and of the Company which would render any amount
stated in the financial statements misleading.

(e) At the date of this report, there does not exist:

(i) any charge on the assets of the Group or of the Company which has arisen since the end of the
financial year which secures the liabilities of any other person; or

(ii) any contingent liability of the Group or of the Company which has arisen since the end of the
financial year.

(f) In the opinion of the Directors:

(i) no contingent or other liability has become enforceable or is likely to become enforceable within
the period of twelve months after the end of the financial year which will or may affect the ability of
the Group or of the Company to meet their obligations when they fall due; and

(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the
end of the financial year and the date of this report which is likely to affect substantially the results
of the operations of the Group or of the Company for the financial year in which this report is made.

2023 Annual Report 121

DIRECTORS’
REPORT

Auditors

Auditors’ remuneration is as follows:

Group Company
RM’000 RM’000

Total statutory audit fees 817 680

To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young PLT, as part
of the terms of its audit engagement against claims by third parties arising from the audit (for an unspecified
amount). No payment has been paid to indemnify Ernst & Young PLT during the financial year and since the end
of the financial year.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors dated 30 April 2024.

Dato’ Fam Lee Ee Dato’ Abdul Mutalib bin Alias

Director Director

Kuala Lumpur, Malaysia

122 AirAsia X Berhad

STATEMENTS OF
PROFIT OR LOSS
For the financial year ended 31 December 2023

Group Company
Note 1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Revenue 4 2,527,096 825,860 2,526,653 825,277

Operating expenses
- Staff costs 5 (204,071) (106,442) (200,121) (104,820)
- Depreciation 6 (184,395) (40,270) (184,395) (40,270)
- Aircraft fuel expenses (1,256,429) (354,896) (1,256,429) (354,896)
- Maintenance and overhaul 7 (351,045) (472,353) (351,045) (471,971)
- User charges (247,619) (96,965) (247,619) (96,965)
- Aircraft operating lease expenses (72,158) (33,637) (72,461) (33,637)
- Other operating expenses 9 (195,249) (275,115) (181,381) (267,418)
- Reversal of/(provision for)
additional loss in the investment in
IAAX 223,245 (223,245) 223,245 (223,245)
Other income 10 239,592 34,328,563 224,087 34,414,146
Other loss 12 - (46,000) - (46,000)
Operating income 478,967 33,505,500 480,534 33,600,201
Finance income 11 2,702 1,553 2,702 1,553
Finance costs 11 (112,601) (762,967) (112,601) (762,967)
Net operating income 369,068 32,744,086 370,635 32,838,787
Net foreign exchange loss 11 (25,295) (47,742) (25,295) (47,742)
Share of results of an associate 19 - - - -
Share of results of a joint venture 20 - - - -
Profit before taxation 343,773 32,696,344 345,340 32,791,045

Taxation
- Current taxation 13 (1,936) 1 (1,936) 1
- Deferred taxation 13 (10,332) 612,240 (10,332) 612,240
(12,268) 612,241 (12,268) 612,241
Profit for the financial year/period 331,505 33,308,585 333,072 33,403,286

Earnings per share (sen)

- Basic 14 74.2 8,029.7
- Diluted 14 74.2 8,029.7

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

2023 Annual Report 123

STATEMENTS OF
COMPREHENSIVE INCOME
For the financial year ended 31 December 2023

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Profit for the financial year/period 331,505 33,308,585 333,072 33,403,286

Other comprehensive loss

Items that may be subsequently reclassified to
profit or loss
Foreign currency translation differences (5,596) (713) - -
Other comprehensive loss for the financial
year/period, net of tax (5,596) (713) - -

Total comprehensive income for the financial

year/period 325,909 33,307,872 333,072 33,403,286

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

124 AirAsia X Berhad

STATEMENTS OF
FINANCIAL POSITION
As at 31 December 2023

Note 31.12.2023 31.12.2022

RM’000 RM’000
Restated

Group

Assets
Non-current assets
Property, plant and equipment 15 35,295 41,848
Right-of-use assets 16 1,306,448 1,044,312
Deferred tax assets 17 601,908 612,240
Investment in an associate 19 - -
Investment in a joint venture 20 - -
Amount due from an associate 23 32,641 -
Trade and other receivables 22 436,266 234,248
Amount due from related parties 25 21,935 -
2,434,493 1,932,648

Current assets
Inventories 21 6,968 9,190
Trade and other receivables 22 224,610 230,634
Amount due from an associate 23 - 29
Amount due from related parties 25 413,615 131,848
Tax recoverable 198 1,735
Deposits, cash and bank balances 29 57,689 176,710
703,080 550,146
Total assets 3,137,573 2,482,794

Equity and liabilities

Current liabilities
Sales in advance 34 612,296 391,373
Trade and other payables 30 360,232 429,167
Amount due to an associate 26 4,603 3,380
Amount due to related parties 28 41,401 8,469
Lease liabilities 31 152,392 57,033
Provision for aircraft maintenance 33 57,747 17,869
Other provisions 32 13,000 13,000
1,241,671 920,291
Net current liabilities (538,591) (370,145)

2023 Annual Report 125

STATEMENTS OF
FINANCIAL POSITION
As at 31 December 2023 (Cont’d.)

Note 31.12.2023 31.12.2022

RM’000 RM’000
Restated

Group (Cont’d.)

Non-current liabilities
Sales in advance 34 55,320 352,139
Lease liabilities 31 1,359,633 1,005,449
Provision for aircraft maintenance 33 331,774 207,899
Other provisions 32 33,000 256,245
1,779,727 1,821,732
Total liabilities 3,021,398 2,742,023
Net assets/(liabilities) 116,175 (259,229)

Equity attributable to equity holders of the Company

Share capital 35 51,029 1,534
Currency translation reserve (5,582) 14
Retained earnings/(accumulated losses) 70,728 (260,777)
Total equity 116,175 (259,229)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

126 AirAsia X Berhad

STATEMENTS OF
FINANCIAL POSITION
As at 31 December 2023 (Cont’d.)

Note 31.12.2023 31.12.2022

RM’000 RM’000
Restated

Company

Assets
Non-current assets
Property, plant and equipment 15 35,295 41,848
Right-of-use assets 16 1,306,448 1,044,312
Deferred tax asset 17 601,908 612,240
Investments in subsidiaries 18 4 4
Investment in an associate 19 - -
Investment in a joint venture 20 - -
Trade and other receivables 22 436,266 234,248
Amount due from subsidiaries 24 32,261 -
Amount due from related parties 25 21,935 -
2,434,117 1,932,652

Current assets
Inventories 21 6,968 9,190
Trade and other receivables 22 222,867 114,222
Amount due from subsidiaries 24 569 -
Amount due from related parties 25 413,478 132,580
Tax recoverable 198 1,652
Deposits, cash and bank balances 29 57,113 176,373
701,193 434,017
Total assets 3,135,310 2,366,669

Equity and liabilities

Current liabilities
Sales in advance 34 612,296 391,373
Trade and other payables 30 326,916 300,521
Amount due to subsidiaries 27 11,809 635
Amount due to an associate 26 4,603 3,380
Amount due to related parties 28 41,401 8,469
Lease liabilities 31 152,392 57,033
Provision for aircraft maintenance 33 57,747 17,674
Other provisions 32 13,000 13,000
1,220,164 792,085
Net current liabilities (518,971) (358,068)

2023 Annual Report 127

STATEMENTS OF
FINANCIAL POSITION
As at 31 December 2023 (Cont’d.)

Note 31.12.2023 31.12.2022

RM’000 RM’000
Restated

Company (Cont’d.)

Non-current liabilities
Sales in advance 34 55,320 352,139
Lease liabilities 31 1,359,633 1,005,449
Provision for aircraft maintenance 33 331,774 207,899
Other provisions 32 33,000 256,245
1,779,727 1,821,732
Total liabilities 2,999,891 2,613,817
Net assets/(liabilities) 135,419 (247,148)

Equity attributable to equity holders of the Company

Share capital 35 51,029 1,534
Retained earnings/(accumulated losses) 84,390 (248,682)
Total equity 135,419 (247,148)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

128 AirAsia X Berhad

CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
For the financial year ended 31 December 2023

Attributable to equity holders of the Group

Non-Distributable
(Accumulated
losses)/
Currency Distributable
Number Share translation retained Total
Note of shares capital reserve earnings equity
‘000 RM’000 RM’000 RM’000 RM’000

Group

At 1 January 2023, as per previously stated 414,815 1,534 14 (286,751) (285,203)

Prior year adjustment (Note 45) - - - 25,974 25,974
At 1 January 2023, restated 414,815 1,534 14 (260,777) (259,229)
Net profit for the financial year - - - 331,505 331,505
Other comprehensive loss for the financial year - - (5,596) - (5,596)
Total comprehensive (loss)/income for the financial year - - (5,596) 331,505 325,909
Issuance of ordinary shares 35 32,258 49,495 - - 49,495
At 31 December 2023 447,073 51,029 (5,582) 70,728 116,175

2023 Annual Report

129
CONSOLIDATED STATEMENT OF

130
CHANGES IN EQUITY
For the financial year ended 31 December 2023 (Cont’d.)

Attributable to equity holders of the Group

Non-Distributable

AirAsia X Berhad
Currency
Number Share translation Accumulated Total
Note of shares capital reserve losses equity
‘000 RM’000 RM’000 RM’000 RM’000
Restated

Group

At 1 July 2021 4,148,149 1,534,044 727 (35,101,872) (33,567,101)

Net profit for the financial period - - - 33,308,585 33,308,585
Other comprehensive loss for the financial period - - (713) - (713)
Total comprehensive (loss)/income for the financial period - - (713) 33,308,585 33,307,872
Share consolidation 35 (3,733,334) - - - -
Share capital reduction 35 - (1,532,510) - 1,532,510 -
At 31 December 2022 414,815 1,534 14 (260,777) (259,229)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
STATEMENT OF
CHANGES IN EQUITY
For the financial year ended 31 December 2023

Attributable to equity holders of the Company

Non-Distributable
(Accumulated
losses)/
Distributable
Number Share retained Total
Note of shares capital earnings equity
‘ 000 RM’000 RM’000 RM’000

Company

At 1 January 2023, as per previously stated 414,815 1,534 (274,656) (273,122)

Prior year adjustment (Note 45) - - 25,974 25,974
At 1 January 2023, restated 414,815 1,534 (248,682) (247,148)
Total comprehensive income for the financial year - - 333,072 333,072
Issuance of ordinary shares 35 32,258 49,495 - 49,495
At 31 December 2023 447,073 51,029 84,390 135,419

2023 Annual Report

131
STATEMENT OF

132
CHANGES IN EQUITY
For the financial year ended 31 December 2023 (Cont’d.)

AirAsia X Berhad
Attributable to equity holders of the Company
Non-Distributable
Number Share Accumulated Total
Note of shares capital losses equity
‘000 RM’000 RM’000 RM’000
Restated

Company

At 1 July 2021 4,148,149 1,534,044 (35,184,478) (33,650,434)

Total comprehensive income for the financial period - - 33,403,286 33,403,286
Share consolidation 35 (3,733,334) - - -
Share capital reduction 35 - (1,532,510) 1,532,510 -
At 31 December 2022 414,815 1,534 (248,682) (247,148)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
STATEMENTS OF
CASH FLOWS
For the financial year ended 31 December 2023

Group Company
Note 1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Cash flows from operating activities

Profit before taxation 343,773 32,696,344 345,340 32,791,045
Adjustments for:
Property, plant and equipment and
right-of-use assets
- Depreciation 6 184,395 40,270 184,395 40,270
- Reversal of impairment loss 9 - (157,016) - (157,016)
Allowance for/(reversal of) impairment
loss:
- Trade and other receivables 9 16,854 85,882 16,854 85,882
- Inventories 9 - (9,190) - (9,190)
- Amount due from an associate 9, 10 (37,940) 366,160 - -
- Amount due from subsidiaries 9, 10 - - (38,268) 382,862
- Amount due from related parties 9 498 (9,288) 498 (9,288)
Debt settlement and waiver of debts
pursuant to the Debt Restructuring 10 - (34,313,138) - (34,398,721)
(Reversal of)/provision for additional
loss in the investment in IAAX (223,245) 223,245 (223,245) 223,245
Finance income 11 (2,702) (1,548) (2,702) (1,548)
Finance costs 11 97,391 754,519 97,391 754,519
Net gain of discounting effect on
financial instruments 11 15,210 8,443 15,210 8,443
Net unrealised foreign exchange loss 11 63,998 34,099 63,998 34,099

2023 Annual Report 133

STATEMENTS OF
CASH FLOWS
For the financial year ended 31 December 2023 (Cont’d.)

Group Company
Note 1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 30.06.2022 31.12.2023 30.06.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Cash flows from operating activities

(Cont’d.)
Operating gain/(loss) before working
capital changes 458,232 (281,218) 459,471 (255,398)
Changes in working capital:
Inventories 2,222 - 2,222 -
Trade and other receivables (241,241) 1,238,136 (355,639) 1,354,429
Related parties balances (249,180) (803,845) (238,889) (974,182)
Trade and other payables 58,942 (282,883) 160,048 (255,086)
Sales in advance (75,896) 238,671 (75,896) 238,082
Cash flows (used in)/generated from
operations (46,921) 108,861 (48,683) 107,845
Finance costs paid (1,420) - (1,420) -
Interest received 2,702 1,548 2,702 1,548
Tax (paid)/refund (191) (39) (482) 44
Net cash (used in)/generated from
operating activities (45,830) 110,370 (47,883) 109,437

Cash flows from investing activities

Additions of property, plant and
equipment 15 (15,254) (2,021) (15,254) (2,021)
Lease remeasurement 16, 31 105 - 105 -
Net cash used in investing activities (15,149) (2,021) (15,149) (2,021)

Cash flows from financing activities

Repayment of lease liabilities 31 (112,005) (20,084) (112,005) (20,084)
Repayment of hire purchase 29 - (15) - (15)
Deposits pledged as securities - 5,644 - 5,644
Proceeds from issuance of shares 35 49,495 - 49,495 -
Net cash used in financing activities (62,510) (14,455) (62,510) (14,455)

134 AirAsia X Berhad

STATEMENTS OF
CASH FLOWS
For the financial year ended 31 December 2023 (Cont’d.)

Group Company
Note 1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 30.06.2022 31.12.2023 30.06.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Net (decrease)/increase in cash and

cash equivalents (123,489) 93,894 (125,542) 92,961
Effect of movement in foreign
exchange rate 4,468 14,350 6,282 15,063
Cash and cash equivalents at
beginning of the financial period 176,710 68,466 176,373 68,349
Cash and cash equivalents at end of
the financial period 29 57,689 176,710 57,113 176,373

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

2023 Annual Report 135

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

1. Corporate information

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and listed
on the Main Market of Bursa Malaysia Securities Berhad (“Bursa Securities”). The registered office and
principal place of business of the Company is located at RedQ, Jalan Pekeliling 5, Lapangan Terbang
Antarabangsa Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan.

The principal activity of the Company is that of providing long haul air transportation services. The
principal activities of the subsidiary companies are disclosed in Note 18.

The financial statements were authorised for issue by the Board of Directors in accordance with a resolution
of the Directors on 30 April 2024.

2. Summary of material accounting policies

Unless otherwise stated, the following accounting policies have been applied consistently in dealing with
items that are considered material in relation to the financial statements.

2.1 Basis of preparation

The financial statements of the Group and of the Company have been prepared in accordance with
the Malaysian Financial Reporting Standards (“MFRS”), International Financial Reporting Standards
(“IFRS”) and the requirements of the Companies Act 2016 in Malaysia.

The financial statements of the Group and of the Company have been prepared under the historical
cost basis except otherwise disclosed in this summary of significant accounting policies below.

The financial statements are presented in Ringgit Malaysia (“RM”) and all values are rounded to the
nearest thousand (RM’000) except when otherwise indicated.

The preparation of financial statements is in conformity with MFRS requires the use of certain critical
accounting estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements, and the
reported amounts of revenues and expenses during the reported financial period. It also requires
Directors to exercise their judgment in the process of applying the Group’s and the Company’s
accounting policies. Although these estimates and judgment are based on the Directors’ best
knowledge of current events and actions, actual results may differ. The areas involving a higher
degree of judgment or complexity, or areas where assumptions and estimates are significant to the
financial statements are disclosed in Note 3.

136 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.2 Changes in accounting policies

On 1 January 2023, the Group and the Company adopted the following new and amended MFRSs
and IC interpretation mandatory for annual financial periods beginning on or after 1 January 2023:

Effective for annual periods beginning on or after 1 January 2023

MFRS 17 Insurance Contracts

Amendments to MFRS 17 Initial Application of MFRS 17 and MFRS 9
- Comparative Information
Amendments to MFRS 101 and MFRS Disclosure of Accounting Policies
Practice Statement 2
Amendments to MFRS 108 Definition of Accounting Estimates
Amendments to MFRS 112 Deferred Tax related to Assets and Liabilities arising
from a Single Transaction
Amendments to MFRS 112 International Tax Reform - Pillar Two Model Rules

The adoption of the above standards and interpretations did not have any material impact on the
financial performance or position of the Group and of the Company, except for:

Amendments to MFRS 101 - Disclosure of Accounting Policies

The amendments provide guidance and examples to help entities apply materiality judgements
to accounting policy disclosures. The amendments aim to help entities provide accounting
policy disclosures that are more useful by replacing the requirement for entities to disclose their
“significant” accounting policies with a requirement to disclose their “material” accounting policies
and adding guidance on how entities apply the concept of materiality in making decisions about
accounting policy disclosures.

The amendments have had an impact on the Group’s and the Company’s disclosures of accounting
policies, but not on the measurement, recognition or presentation of any items in the Group’s and
the Company’s financial statements.

2.3 Standards issued but not yet effective

The following standards, amendments and interpretations that have been issued by the Malaysian
Accounting Standards Board (“MASB”) will become effective in future financial reporting periods
and have not been adopted by the Group and/or the Company in these financial statements:

Effective for annual periods beginning on or after 1 January 2024

Amendments to MFRS 101 Classification of Liabilities as Current or Non-current

Amendments to MFRS 16 Lease Liability in a Sale and Leaseback
Amendments to MFRS 101 Non-Current Liabilities with Covenants
Amendments to MFRS 107 and MFRS 7 Disclosure of Supplier Finance Arrangements

2023 Annual Report 137

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.3 Standards issued but not yet effective (Cont’d.)

The following standards, amendments and interpretations that have been issued by the Malaysian
Accounting Standards Board (“MASB”) will become effective in future financial reporting periods and
have not been adopted by the Group and/or the Company in these financial statements: (Cont’d.)

Effective for annual periods beginning on or after 1 January 2025

Amendments to MFRS 121 Lack of Exchangeability

Effective for a date yet to be confirmed

Amendments to MFRS 10 Sale or Contribution of Assets between an Investor

and its Associate or Joint Venture
Amendments to MFRS 128 Sale or Contribution of Assets between an Investor
and its Associate or Joint Venture

The amendments to MFRSs above are not expected to have any significant impact on the financial
statements of the Group and the Company upon their initial application except for the changes in
presentation and disclosures of financial information arising from the adoption of these amendments
to MFRSs.

2.4 Basis of consolidation

The consolidated financial statements include the Company’s and its subsidiaries’ financial
information as of 31 December 2023. Control over a subsidiary is established when the Group has
the power to influence variable returns and direct the subsidiary’s relevant activities.

Typically, a majority of voting rights implies control. However, when the Group holds less than the
majority, it assesses various factors to determine control. These factors include the Group’s voting
rights relative to others, contractual arrangements, and past voting patterns.

Control is reassessed if circumstances change. Consolidation of a subsidiary begins when control is

obtained and ends when control is lost. Assets, liabilities, income, and expenses of a subsidiary are
included in the consolidated financial statements from acquisition until cessation of control.

Profits, losses, and other comprehensive income (“OCI”) are attributed to the parent company’s
equity holders and non-controlling interests, even if this results in the non-controlling interest in
having a deficit balance. When necessary, adjustments are made to align the subsidiary’s accounting
policies with the Group’s. All intra-group transactions are eliminated.

Changes in subsidiary ownership without loss of control are treated as equity transactions. When
control is lost, all related assets, liabilities, and equity components are derecognised, with any
remaining investment valued at fair value. If the Group loses control over a subsidiary, any remaining
investment is measured at fair value. The difference between the carrying amount and fair value is
recognised in profit or loss.

138 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.5 Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The cost of acquisition is
the sum of the consideration paid and any non-controlling interests in the acquired entity.

Upon acquisition, the Group evaluates the financial assets and liabilities assumed to ensure proper
classification and designation. Any contingent consideration is recognised at fair value at the
acquisition date. If classified as equity, it’s not remeasured. If classified as a financial instrument, it’s
measured at fair value with subsequent changes recognised in profit or loss.

Goodwill is initially measured as the excess of consideration paid over the net identifiable assets
acquired and liabilities assumed. If the fair value of net assets acquired exceeds the consideration,
the Group reassesses its identification of assets and liabilities. Any remaining excess is recognised
as a gain in profit or loss.

Goodwill is measured at cost less any accumulated impairment losses. It’s allocated to cash-
generating units for impairment testing, regardless of other assets or liabilities. If the goodwill is
part of a cash-generating unit being disposed of, the associated goodwill is included in the carrying
amount of the disposed operation.

2.6 Investment in associates and joint ventures

The Group holds interests in an associate and a joint venture as disclosed in Note 19 and Note 20
respectively.

An associate is an entity over which the Group has significant influence, allowing participation in
financial and operating decisions.

A joint venture is a type of joint arrangement whereby the parties that have joint control of the
arrangement have rights to the net assets of the joint venture. Joint control is contractually agreed
sharing of control of an arrangement, which exists only when decisions about the relevant activities
require the unanimous consent of the parties sharing control.

The Group uses the equity method for its investments in associates and joint ventures reports the
share of profit or loss from associates separately in the profit or loss.

Investments in associates and joint ventures are initially recorded at cost. The carrying amount is
adjusted for changes in the Group’s share of the associate’s or joint venture’s net assets. Goodwill
related to associates or joint ventures is included in the investment’s carrying amount and are not
separately tested for impairment.

In the Company’s separate financial statements, investments in associates and joint ventures are
stated at cost less accumulated impairment losses.

Results from associates and joint ventures are included in the Group’s profit or loss and OCI.
Unrealised gains and losses from transactions with associates and joint ventures are eliminated
to the extent of the Group’s interest. The financial statements of associates and joint ventures are
aligned with the Group’s reporting period and accounting policies, when necessary.

The Group assesses for impairment at each reporting date and such impairment losses are
recognised in profit or loss.

2023 Annual Report 139

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.6 Investment in associates and joint ventures (Cont’d.)

If the Group loses significant influence over an associate or joint control over the joint venture, any
remaining investment is measured at fair value. The difference between the carrying amount and
fair value is recognised in the profit or loss.

2.7 Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated
impairment losses. The cost of an item of property, plant and equipment initially recognised includes
its purchase price and any cost that is directly attributable to bringing the asset to the location and
condition necessary for it to be capable of operating in the manner intended by management.

Where significant parts of an item of property, plant and equipment are required to be replaced at
intervals, the Group and the Company recognise such parts in the carrying amount of the property,
plant and equipment as a replacement when it is probable that future economic benefits associated
with the parts will flow to the Group and the Company and the cost of the parts can be measured
reliably. The carrying amount of the replaced part is derecognised.

Depreciation is calculated using the straight-line method to write off the cost of the assets to their
residual values over their estimated useful lives.

The useful lives for this purpose are as follows:

Aircraft service potential of engines and airframe 6 or 12 years

Aircraft spares 10 years
Aircraft fixtures and fittings Useful life of aircraft or remaining lease
term of aircraft, whichever is shorter
Motor vehicles 5 years
Office equipment, furniture and fittings 5 years

Assets not yet in operation are stated at cost and are not depreciated until the assets are ready for
their intended use. Useful lives of assets are reviewed and adjusted if appropriate, at the financial
position date.

Residual values, where applicable, are reviewed annually against prevailing market values at the
financial position date for equivalent aged assets, and depreciation rates are adjusted accordingly
on a prospective basis.

The costs of upgrades to leased assets are capitalised and amortised over the shorter of the
expected useful life of the upgrades or the remaining life of the aircraft.

Pre-delivery payments on aircraft purchase are included as part of the cost of the aircraft and are
depreciated from the date that the aircraft is ready for its intended use.

140 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.8 Investments in subsidiaries

In the Company’s separate financial statements, investments in subsidiaries are stated at cost less
accumulated impairment losses.

2.9 Impairment of non-financial assets

The Group and the Company assess, at each reporting date, whether any indication exists that an
asset may be impaired. If so, or when annual impairment testing is required, the Group and the
Company estimate the asset’s recoverable amount. Recoverable amount is the higher of its fair
value less costs of disposal and its value in use (“VIU”).

The Group and the Company estimate VIU using projected future cash flows to their present value
using a pre-tax discount rate. In determining fair value less costs of disposal, market transactions
and appropriate valuation models are used. Impairment calculations are based on the Group’s and
the Company’s most recent budgets and forecasts, covering a period of five years. A long-term
growth rate is applied to project future cash flows beyond the fifth year.

Impairment losses are recognised in the statement of profit or loss in expense categories consistent
with the function of the impaired asset. For assets excluding goodwill, the Group and the Company
assess at each reporting date whether previously recognised impairment losses no longer exist or
have decreased. Reversals are recognised in the profit or loss to the extent that such reversal do
not exceed the previous impairment less amortisation or depreciation of the asset had the asset
was not impaired. Goodwill is tested for impairment annually and when circumstances indicate
potential impairment. Impairment is determined by comparing the recoverable amount of the cash-
generating unit (CGU) to which the goodwill relates with its carrying amount.

Intangible assets with indefinite useful lives are tested for impairment annually or when indications
of impairment arise.

Climate risks, including physical and transition risks, are assessed for their potential impact. If
significant, these risks are factored into cash-flow forecasts when assessing value-in-use amounts.

2.10 Maintenance and overhaul

(i) Owned aircraft

The accounting for the cost of major airframe and certain engine maintenance checks for own
aircraft is described in the accounting policy in Note 2.7 for property, plant and equipment.

(ii) Leased aircraft

Where the Group and the Company have a commitment to maintain aircraft held under
operating leases, a provision is made during the lease term for the rectification obligations
contained within the lease agreements. The provisions are based on estimated future costs
of major airframe, certain engine maintenance checks and one-off costs incurred at the end
of the lease by making appropriate charges to the profit or loss calculated by reference to
the number of flying hours, flying cycles operated during the financial period and calendar
months of the components used.

2023 Annual Report 141

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.11 Leases

The Group and the Company assess at contract inception whether a contract is, or contains, a lease.
That is, if the contract conveys the right to control the use of an identified asset for a period of time
in exchange for consideration.

Group and Company as a lessee

The Group and the Company apply a single recognition and measurement approach for all leases,
except for short-term leases and leases of low-value assets. The Group and the Company recognise
lease liabilities and right-of-use (“ROU”) assets representing the right to use the underlying assets.

(i) ROU assets

Upon lease commencement, the Group and the Company recognise ROU assets, initially
recognising them at cost and subsequently adjusting them for accumulated depreciation
and impairment losses, if any. The asset’s cost includes lease liabilities, initial direct costs, and
lease payments made less incentives received. Depreciation is applied on a straight-line basis
over the shorter of the lease term or asset’s useful life as follows:

Aircraft and engines 2 to 14 years

Office 2 to 20 years

If ownership of the leased asset transfers to the Group at the end of the lease term or the
cost reflects the exercise of a purchase option, depreciation is calculated using the estimated
useful life of the asset.

The ROU assets are also subject to impairment.

(ii) Lease liabilities

Upon lease commencement, the Group and the Company recognise lease liabilities, measured
at the present value of lease payments over the lease term. These payments include fixed
payments, less any lease incentives received, variable payments dependent on an index
or rate, amounts under residual value guarantees, and purchase option exercise prices or
termination penalties.

Variable payments not tied to an index or rate are expensed when triggered.

The present value of lease payments is calculated using the incremental borrowing rate at
lease commencement, if the lease’s implicit interest rate is not easily determinable. Over time,
lease liabilities increase for interest accrual and decrease for payments made. Additionally,
they are remeasured for modifications, changes in lease terms or payments, or revised
assessments of purchase options.

Lease liabilities are reported within interest-bearing loans and borrowings.

142 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.11 Leases (Cont’d.)

(iii) Short-term leases and leases of low-value assets

For leases with a term of 12 months or less and lacking a purchase option, the Group and the
Company apply a short-term lease recognition exemption. Similarly, leases of deemed low
value also qualify for exemption.

Lease payments for these short-term and low-value asset leases are expensed evenly over
the lease term on a straight-line basis.

2.12 Inventories

Inventories comprising consumables used internally for repairs and maintenance and in-flight
merchandise, are stated at the lower of cost and net realisable value.

Cost is determined on the weighted average basis, and comprises the purchase price and incidentals
incurred in bringing the inventories to their present location and condition.

Net realisable value represents the estimated selling price in the ordinary course of business, less all
applicable variable selling expenses. In arriving at net realisable value, due allowance is made for all
damaged, obsolete and slow-moving items.

2.13 Fair value measurement

The Group and the Company measure financial instruments at fair value at each reporting date. Fair
value is the price at which an asset could be sold or a liability transferred in an orderly transaction
between market participants at the measurement date.

Fair value is determined based on the presumption that the transaction occurs in either the
principal market or, if not available, the most advantageous market accessible to the Group and the
Company. The measurement considers assumptions that market participants act in their economic
best interest.

When measuring fair value for non-financial assets, it accounts for their potential economic benefits
in their highest and best use.

The Group uses appropriate valuation techniques, maximising observable inputs and minimising
unobservable ones, with fair value measurements categorised into three levels based on the
significance of inputs:

Level 1: Quoted market prices in active markets.

Level 2: Valuation techniques with observable inputs.
Level 3: Valuation techniques with unobservable inputs.

Transfers between levels are assessed at each reporting period. Classes of asset and liability are
determined for fair value disclosures based on their nature, characteristics, risks, and their level
within the fair value hierarchy.

2023 Annual Report 143

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.14 Cash and cash equivalents

For the purpose of the statements of cash flows, cash and cash equivalents comprise cash on hand,
bank balances, demand deposits, bank overdrafts and other short-term, highly liquid investments
with original maturities of three months or less that are readily convertible to known amounts of
cash and which are subject to an insignificant risk of changes in value.

2.15 Provisions

Provisions are recognised when the Group has a present obligation due to a past event, and it’s
probable that resources will be needed to settle it, with the amount being able to be estimated
reliably. If certain portion of the provision is reimbursable, it is recognised as a separate asset only
when the reimbursement is virtually certain. The expense is recognised in the profit or loss net of
any reimbursement.

If time value of money is significant, provisions are discounted using a current pre-tax rate reflecting
specific liability risks. The increase in the provision due to time passage is recognised as a finance
cost when discounting is applied.

2.16 Borrowing cost

Borrowing costs directly attributable to the acquisition, construction or production of an asset that
necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised
as part of the cost of the asset. All other borrowing costs are expensed in the period in which they
occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with
the borrowing of funds.

2.17 Income taxes

(i) Current tax

Current income tax assets and liabilities are measured based on the expected amounts to be
paid to or recovered from taxation authorities. This calculation uses enacted or substantively
enacted tax rates and laws applicable at the reporting date in the countries where the Group
operates and generates taxable income.

For items recognised directly in equity, current income tax is recognised in equity, not in
the profit or loss. Management periodically reviews tax return positions, particularly in cases
where tax regulations are open to interpretation, and establishes provisions as necessary.

(ii) Deferred tax

Deferred tax is recognised using the liability method based on temporary differences between
the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes at the reporting date.

144 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.17 Income taxes (Cont’d.)

(ii) Deferred tax (Cont’d.)

Deferred tax liabilities are recognised for all taxable temporary differences, except for:

• When the deferred tax liability arises from the initial recognition of goodwill or an asset
or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss.

• In respect of taxable temporary differences associated with investments in subsidiaries,

associates and interests in joint arrangements, when the timing of the reversal of
the temporary differences can be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, subject to the
extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry forward of unused tax credits and unused tax losses can
be utilised, except:

• When the deferred tax asset relating to the deductible temporary difference arises
from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit
nor taxable profit or loss.

• In respect of deductible temporary differences associated with investments in

subsidiaries, associates and interests in joint arrangements, deferred tax assets are
recognised only to the extent that it is probable that the temporary differences will
reverse in the foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date, with
adjustments made based on the probability of future taxable profits.

Deferred tax assets and liabilities are measured using expected future tax rates, based on
rates that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items outside profit or loss is recognised accordingly, either in OCI or
directly in equity.

Tax benefits acquired as part of a business combination are recognised subsequently if new
information about facts and circumstances changes.

The Group and the Company offset deferred tax assets and liabilities if they have a legally
enforceable right to set off current tax assets and liabilities and certain other conditions are
met.

2023 Annual Report 145

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.18 Revenue recognition

(a) Revenue from contracts with customers

(i) Scheduled flights

Revenue from scheduled passenger flights is recognised upon the rendering of

transportation services net of discounts. The revenue of seats sold for which services
have not been rendered is included in current liabilities as sales in advance.

(ii) Charter flights

Revenue from charter flights is recognised upon the rendering of transportation

services.

(iii) Ancillary revenue

Ancillary revenue including fuel surcharge, insurance surcharge, administrative fees,

assigned seat, change fees, convenience fee, baggage fee, connecting fee, cancellation,
documentation and other fees, and on-board sale of meals and merchandise are
recognised upon the completion of services rendered net of discounts.

(iv) Freight services

Freight revenue is a distinct performance obligation and recognised upon the

completion of services rendered net of discounts.

(v) Management fee

Management fees, incentives and commission income are recognised on an accrual

basis.

2.19 Foreign currencies

(i) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured
using the currency of the primary economic environment in which the entity operates (“the
functional currency”). The financial statements are presented in Ringgit Malaysia, which is the
Company’s functional and presentation currency.

When the Group engages in transactions denominated in foreign currencies, the initial
recording is done at the spot exchange rate of the functional currency at the time of
recognition.

For monetary assets and liabilities in foreign currencies, they are translated at the spot
exchange rates at the reporting date. Any differences arising from settlement or translation
of these monetary items are then recognised in the Group’s profit or loss. However, if a
monetary item is designated as part of a hedge of the Group’s net investment in a foreign
operation, any differences are initially recognised in OCI until the net investment is disposed
of, at which point they are reclassified to profit or loss.

146 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.19 Foreign currencies (Cont’d.)

(ii) Transactions and balances (Cont’d.)

Additionally, for transactions involving advance consideration, the spot exchange rate used
for derecognition of non-monetary assets or liabilities is determined based on the date of the
initial recognition of the asset or liability. This ensures that the appropriate exchange rate is
applied for accurate recording of the transaction.

(iii) Group companies

On consolidation, the assets and liabilities of foreign operations are translated into RM at
the rate of exchange prevailing at the reporting date and their statements of profit or loss
are translated at exchange rates prevailing at the dates of the transactions. The exchange
differences arising on translation for consolidation are recognised in OCI. On disposal of
a foreign operation, the component of OCI relating to that particular foreign operation is
reclassified to profit or loss.

2.20 Financial assets

(i) Initial recognition and measurement

Financial assets are categorised at initial recognition based on their contractual cash flow
characteristics and the Group’s business model for managing them. This classification
determines how the assets are subsequently measured: amortised cost, fair value through
OCI, or fair value through profit or loss.

Trade receivables without significant financing components or for which the Group applies a
practical expedient are measured at the transaction price. For other financial assets, the initial
measurement includes their fair value plus transaction costs, except for those classified at fair
value through profit or loss.

To be classified and measured at amortised cost or fair value through OCI, a financial asset’s
cash flows must be ‘solely payments of principal and interest’ (“SPPI”) on the outstanding
principal. This is assessed at the instrument level. Assets failing the SPPI test are measured at
fair value through profit or loss regardless of the business model.

The Group’s business model for managing financial assets determines how it generates cash
flows from those assets, whether through collecting contractual cash flows, selling assets, or
both. Financial assets held to collect contractual cash flows are classified at amortised cost,
while those held to collect cash flows and sell are classified at fair value through OCI.

Transactions involving financial assets requiring delivery within a specific timeframe, as

regulated by the market, are recognised on the trade date when the Group commits to
purchase or sell the asset.

2023 Annual Report 147

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.20 Financial assets (Cont’d.)

(ii) Subsequent measurement

Subsequent measurement of financial assets involves classification into four categories and
their respective treatment:

Financial assets at amortised cost (debt instruments):

These assets are measured using the effective interest method and are subject to impairment.
Gains and losses are recognised in profit or loss upon derecognition, modification, or
impairment.

Financial assets at fair value through OCI (debt instruments):

Interest income, foreign exchange revaluation, and impairment losses or reversals are
recognised in profit or loss. Remaining fair value changes are recognised in OCI, and upon
derecognition, the cumulative fair value change in OCI is recycled to profit or loss.

Financial assets designated at fair value through OCI (equity instruments):

Equity investments that meet the criteria and are not held for trading can be classified
irrevocably as equity instruments designated at fair value through OCI. Gains and losses
are not recycled to profit or loss, and dividends are recognised as other income unless they
recover part of the asset’s cost, in which case, gains are recorded in OCI.

These assets are not subject to impairment assessment.

Financial assets at fair value through profit or loss:

Carried at fair value with net changes recognised in profit or loss.

This category includes derivative instruments and listed equity investments not classified as
fair value through OCI.

Dividends on listed equity investments are recognised as other income.

Embedded derivatives in hybrid contracts are separated and accounted for separately if
certain conditions are met, with changes in fair value recognised in profit or loss.

(iii) Derecognition

A financial asset is derecognised when:

• The rights to receive cash flows from the asset have expired, or

• The Group and the Company have transferred their rights to receive cash flows from
the asset or has assumed an obligation to pay the received cash flows in full without
material delay to a third party under a ‘pass-through’ arrangement. In such cases,
the Group and the Company evaluate whether they have transferred substantially all
the risks and rewards of the asset, or if they have neither transferred nor retained
substantially all the risks and rewards but have transferred control of the asset.

148 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.20 Financial assets (Cont’d.)

(iii) Derecognition (Cont’d.)

If the Group and the Company have transferred their rights to receive cash flows from an
asset or have entered into a pass-through arrangement, they assess the extent to which
they have retained the risks and rewards of ownership. If they haven’t transferred or retained
substantially all risks and rewards, nor transferred control of the asset, they continue to
recognise the transferred asset to the extent of their continuing involvement. In this scenario,
the Group and the Company also recognise an associated liability, and both are measured
based on the rights and obligations retained.

Continuing involvement, such as a guarantee over the transferred asset, is measured at the
lower of the original carrying amount of the asset and the maximum amount of consideration
that the Group or the Company could be required to repay.

(iv) Impairment

The Group and the Company recognise an allowance for expected credit losses (ECLs) for
all debt instruments not held at fair value through profit or loss. These ECLs are based on
the difference between the contractual cash flows due and all the cash flows expected to
be received, discounted at an approximation of the original effective interest rate. Expected
cash flows include those from collateral sale or other credit enhancements integral to the
contract terms.

ECLs are recognised in two stages:

• For credit exposures without a significant increase in credit risk since initial recognition,
ECLs cover credit losses possible within the next 12 months.

• For exposures with a significant increase in credit risk, a loss allowance covers credit
losses expected over the remaining exposure life, regardless of default timing.

For trade receivables and contract assets, a simplified approach calculates ECLs based on
lifetime ECLs at each reporting date, using a provision matrix grounded in historical loss
experience adjusted for forward-looking factors.

A financial asset is considered in default when payments are 90 days past due, or when
information suggests full recovery is unlikely, considering any credit enhancements held.
Financial assets are written off when full contractual cash flow recovery is improbable.

2.21 Financial liabilities

(i) Initial recognition and measurement

Financial liabilities are categorised at initial recognition as either financial liabilities at fair
value through profit or loss, loans and borrowings, payables, or derivatives designated as
effective hedging instruments.

Upon initial recognition, all financial liabilities are recorded at fair value, with loans and
borrowings and payables recognised net of directly attributable transaction costs.

2023 Annual Report 149

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.21 Financial liabilities (Cont’d.)

(ii) Subsequent measurement

For purposes of subsequent measurement, financial liabilities are classified in two categories:

• Financial liabilities at fair value through profit or loss

• Financial liabilities at amortised cost (loans and borrowings)

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss consist of two categories: financial
liabilities held for trading and financial liabilities designated at fair value through profit or loss
upon initial recognition.

Financial liabilities held for trading include those incurred for the purpose of repurchasing
in the near term, as well as derivative financial instruments not designated as hedging
instruments. Embedded derivatives are also classified as held for trading unless designated
as effective hedging instruments.

Gains or losses on these liabilities are recognised in the statement of profit or loss.

Financial liabilities designated at fair value through profit or loss upon initial recognition are
designated at the inception date if they meet the criteria outlined in MFRS 9.

Financial liabilities at amortised cost (loans and borrowings)

Interest-bearing loans and borrowings, the most relevant category to the Group and the
Company, are subsequently measured at amortised cost using the effective interest rate
(EIR) method after initial recognition. Gains and losses are recognised in profit or loss upon
derecognition of the liabilities, as well as through the EIR amortisation process.

Amortised cost is calculated by considering any discount or premium on acquisition, as well

as fees or costs integral to the effective interest rate. The amortisation of the effective interest
rate is recorded as finance costs in the profit or loss.

This category primarily encompasses interest-bearing loans and borrowings.

(iii) Derecognition

A financial liability is derecognised when the obligation it represents is discharged, cancelled,

or expires. Additionally, if an existing financial liability is replaced by another from the same
lender with substantially different terms, or if the terms of an existing liability are substantially
modified, this exchange or modification is treated as the derecognition of the original liability
and the recognition of a new liability. Any difference in the respective carrying amounts is
recognised in the profit or loss.

150 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

2. Summary of material accounting policies (Cont’d.)

2.21 Financial liabilities (Cont’d.)

(iv) Offsetting

Financial assets and financial liabilities are offset and the net amount is reported in the
consolidated statement of financial position if there is a currently enforceable legal right to
offset the recognised amounts and there is an intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.

2.22 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision-maker. The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified as
the Group Chief Executive Officer (“Group CEO”) that makes strategic decisions.

3. Critical accounting estimates and judgements

The directors continually evaluate estimates and judgments based on historical experience and other
factors, including expectations of future events deemed reasonable under the circumstances. However,
resulting accounting estimates may rarely align precisely with actual results.

Outlined below are estimates and assumptions posing a significant risk of material adjustment to the
carrying amounts of assets and liabilities in the next financial year:

(i) Deferred tax assets

Deferred tax assets primarily stem from unutilised tax incentives, unabsorbed capital allowances,
and tax loss carryforwards. These assets are recognised to the extent that future taxable profits
are probable, which involves significant assumptions. These assumptions pertain to regulatory
approvals for prospective routes, aircraft delivery, fares, load factors, fuel prices, maintenance
costs, and currency movements. They are based on past performance adjusted for non-recurring
circumstances and a reasonable growth rate. Management believes that these projections indicate
the utilisation of temporary differences, leading to the recognition of deferred tax assets as of the
reporting date. Significant changes to the estimates of base fare, load factor and foreign exchange
rates will result in variation in the carrying amount of deferred tax assets recognised.

(ii) Provision for aircraft maintenance

The Group and the Company have contractual obligations to maintain leased aircraft throughout
the lease period and to return them to lessors at lease-end under specific pre-agreed conditions.
Management estimates and accrues costs for overhaul, restoration, and redelivery over the lease
term. These estimates hinge on factors like anticipated aircraft utilisation rates, including flying
hours and cycles leading up to the next overhaul, projected costs from routine and non-routine
checks, and the timing of maintenance work. However, actual results may diverge considerably from
these estimates due to variations in aircraft utilisation and the timing of maintenance activities.

2023 Annual Report 151

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

3. Critical accounting estimates and judgements (Cont’d.)

Outlined below are estimates and assumptions posing a significant risk of material adjustment to the
carrying amounts of assets and liabilities in the next financial year (Cont’d.):

(iii) Impairment assessment of financial assets

The Group and the Company utilise the simplified approach under MFRS 9 to gauge expected credit
losses, employing a lifetime expected loss allowance for all receivables, including balances with
intercompany and related parties. At each reporting date, the Group and the Company evaluate credit
risk, assessing whether there have been significant increases since initial recognition. Impairment
provisions for receivables are founded on assumptions regarding default risk and anticipated loss
rates. In making these assumptions and selecting inputs for impairment calculations, judgment is
exercised, drawing from the Group’s and the Company’s historical data, prevailing market conditions,
and forward-looking estimates tailored to individual debtors and/or group of debtors at the close of
each reporting period.

(iv) Provision for additional loss in the investment in PT Indonesia AirAsia Extra (“IAAX”)

During the financial period ended 31 December 2022, IAAX, a joint venture of the Company,
received a Tax Underpayment Assessment Letter from the Indonesia Tax Office (ITO), demanding
a payment of RM200.7 million for tax underpayment in the fiscal year 2017. The tax audit for the
year assessment 2018 and 2019 were completed during the financial year and the ITO raised an
additional assessment of RM236.6 million.

IAAX has disputed the tax assessments by the ITO and has submitted objection letters and appeal
letters to the ITO. ITO has rejected the appeal by IAAX and the case has been brought to court.
In the event the dispute is ruled in favour of the ITO, it is unlikely that IAAX will be able to pay
the additional tax. Per Indonesian tax regulations, tax collection actions target “tax bearers” of
corporate taxpayers, including shareholders. Consequently, the Company, as IAAX’s shareholder,
could be liable for IAAX’s RM215.9 million tax payable, based on its equity interest in IAAX.

(v) Recoverability of amounts owing by subsidiary companies, associated company and related
parties

During the current financial year, the Group and the Company conducted assessments of the credit
risks associated with amounts owed by an associated company, certain subsidiary companies, and
related parties. Using the ECL model, these evaluations were performed individually for each debt
at each reporting date. The objective was to ascertain whether there had been any significant
increases in credit risk since the initial recognition of these financial assets. This approach allows
the Group and the Company to stay informed about the financial health of these entities and make
informed decisions regarding the recoverability of these amounts.

The amounts owing by associated company, subsidiary companies and related parties are disclosed
in Note 23, Note 24 and Note 25 respectively.

152 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

3. Critical accounting estimates and judgements (Cont’d.)

Outlined below are estimates and assumptions posing a significant risk of material adjustment to the
carrying amounts of assets and liabilities in the next financial year (Cont’d.):

(vi) Contract liability for travel voucher

The Group and the Company have committed to issue travel vouchers to compensate passengers
affected by flight cancellations during the Covid-19 pandemic. These vouchers typically have an
average expiry date of 5 years from the date of issuance.

In 2023, management reviewed and adjusted the method used to calculate the provision for travel
vouchers. Previously, estimates were based on past “No Show” trends, referring to passengers who
purchased flight tickets but didn’t board their scheduled flights. However, management determined
that this trend wasn’t an accurate representation of the travel voucher liabilities. Instead, for the
financial year ended 31 December 2023, management estimated the liability required based on the
historical redemption rate of the travel vouchers. Actual utilisation may still vary significantly from
these estimates.

(vii) Incremental borrowing rate for the discounting of lease payment

The Group and the Company cannot readily determine the interest rate implicit in the lease,
therefore, they uses its incremental borrowing rate (IBR) to measure lease liabilities. The IBR is the
rate of interest that the Group and the Company would have to pay to borrow over a similar term,
and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-
use asset in a similar economic environment. The IBR therefore reflects what the Group ‘would have
to pay’, which requires estimation when no observable rates are or when they need to be adjusted
to reflect the terms and conditions of the lease.

The Group estimates the IBR using observable inputs (such as market interest rates) when available
and is required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit
rating).

(viii) Provision for profit-sharing

Under the scheme of arrangement with scheme creditors sanctioned by the High Court of Malaya
on 16 March 2022 on the proposed debt restructuring, Class A and Class B scheme creditor will be
entitled to an annual profit-sharing mechanism, calculated based on the pro-rating of the payout
pool, which equates to 20% of the excess over RM300 million of adjusted earnings before interest,
taxes, depreciation, amortisation and lease rentals (“EBITDAR”) for the financial years ending 2023
to 2026 (“applicable financial year”). The profit-sharing mechanism has no prejudice to the scheme
and without limiting or affecting the debt settlement and waiver, Class A and Class B creditors
shall received a portion of AAX’s profits subject to and based on the terms of the profit-sharing
mechanism.

During the financial year ended 31 December 2023, management has estimated the provision for
profit sharing for scheme creditor based on possible scenarios of the forecast projected EBITDAR
for financial year 2024 to financial year 2026 resulting in a provision for profit sharing or RM46
million. Actual payout of the profit share will deviate if actual results deviate significantly against the
forecast.

2023 Annual Report 153

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

4. Revenue

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Revenue from contracts with customers 2,526,653 798,113 2,526,653 798,113

Aircraft operating lease income - 27,164 - 27,164
Management fee 443 583 - -
2,527,096 825,860 2,526,653 825,277

Revenue from contracts with customers

Type of goods or services

Scheduled flights 1,673,926 272,387 1,673,926 272,387
Charter flights 18,796 105,625 18,796 105,625
Freight services 151,673 341,595 151,673 341,595
Ancillary revenue 682,258 78,506 682,258 78,506
2,526,653 798,113 2,526,653 798,113

Timing of revenue recognition

At a point of time 2,526,653 798,113 2,526,653 798,113

Ancillary revenue includes baggage fees, assigned seats, cancellations, documentation and other fees,
and on-board sale of meals and merchandise.

Salient terms of revenue from contracts with customers:

i) Scheduled flights - Tickets bought are valid over a period of 30 - 60 days and refunds for airport tax
are claimable up to 6 months period of travel date.
ii) Charter flights - Full upfront payment before the flight.
iii) Freight services - Credit term of 30 days (2022: 30 days) from invoice date.
iv) Ancillary services - Normally settle by cash and generally no refunds.

Unsatisfied performance obligations represented by sales in advance is disclosed in Note 34. Contract
balances, represented by trade receivables and amount due from AirAsia Berhad are disclosed in Note 22
and Note 25 respectively.

154 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

5. Staff costs

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Wages, salaries, bonuses and allowances 187,499 96,689 183,549 95,067

Defined contribution retirement plan 16,572 9,753 16,572 9,753
204,071 106,442 200,121 104,820

Included in staff costs are Directors’ remunerations as disclosed in Note 8.

6. Depreciation

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Property, plant and equipment (Note 15) 21,807 - 21,807 -

Right-of-use assets (Note 16) 162,588 40,270 162,588 40,270
184,395 40,270 184,395 40,270

7. Maintenance and overhaul

Maintenance and overhaul include routine and non-routine maintenance of the aircraft airframe, engines,
landing gear, wheels and other consumable spares.

2023 Annual Report 155

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

8. Directors’ remuneration

Details of remunerations paid to Directors are as follows:

Group and Company

Emoluments/
Other
Fees allowances Total
RM’000 RM’000 RM’000

2023

Non-Executive Directors:
Datuk Kamarudin bin Meranun 85 507 592
Dato’ Fam Lee Ee 207 18 225
Tan Sri Asmat bin Kamaludin 172 14 186
Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin 204 13 217
Ahmad Al Farouk bin Ahmad Kamal 131 15 146
Chin Min Ming 116 18 134
Dato’ Sri Mohammed Shazalli bin Ramly 22 2 24
Dato’ Abdul Mutalib bin Alias 24 2 26
Total Non-Executive Directors 961 589 1,550

Group and Company

Emoluments/
Other
Fees allowances Total
RM’000 RM’000 RM’000

2022

Non-Executive Directors:
Datuk Kamarudin bin Meranun 95 8 103
Tan Sri Anthony Francis Fernandes 76 8 84
Dato’ Lim Kian Onn 86 12 98
Dato’ Fam Lee Ee 163 21 184
Tan Sri Rafidah Aziz 229 12 241
Tan Sri Asmat bin Kamaludin 132 17 149
Dato’ Yusli bin Mohamed Yusoff 101 11 112
Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin 88 6 94
Ahmad Al Farouk bin Ahmad Kamal 44 4 48
Chin Min Ming 6 - 6
Total Non-Executive Directors 1,020 99 1,119

156 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

8. Directors’ remuneration (Cont’d.)

Further analysis of remuneration paid to the Directors are as follows:

Group and Company

Number of Directors
31.12.2023 31.12.2022

Non-executive Directors:
Less than RM100,000 2 5
RM100,001 to RM150,000 2 3
RM150,001 to RM200,000 1 1
More than RM200,000 3 1

9. Other operating expenses

The following items have been charged/(credited) in arriving at other operating expenses:

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Management fee (443) 229 3,458 1,838

Rental of land and buildings (Note 16) 2,861 1,982 2,861 1,982
Auditors’ remuneration
- Statutory audit 817 735 680 680
- Non-audit fees 2,500 1,700 2,500 1,700
Rental of equipment (Note 16) 8 9 8 9
Advertising expenses (1,166) 1,672 (1,166) 1,672
Credit card charges 28,464 7,917 28,464 7,917
In-flight meal expenses 8,282 199 8,282 199
Insurance expenses 18,457 24,586 18,457 24,586
Allowance for/(reversal of) expected
credit losses on:
- Trade and other receivables
(Note 22) 16,854 85,882 16,854 85,882
- Amount due from an associate
(Note 23) - 366,160 - -
- Amount due from subsidiaries
(Note 24) - - - 382,862
- Amount due from related parties
(Note 25) 498 (9,288) 498 (9,288)

2023 Annual Report 157

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

9. Other operating expenses (Cont’d.)

The following items have been charged/(credited) in arriving at other operating expenses (Cont’d.):

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Reversal of inventories written-off

(Note 21) - (9,190) - (9,190)
Reversal of impairment loss on property,
plant and equipment (Note 15) - (157,016) - (157,016)

10. Other income

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Debt settlement and waiver of debts

pursuant to the Debt Restructuring - 34,313,138 - 34,398,721
Reversal of provision for travel voucher 185,819 - 185,819 -
Reversal of impairment loss on amount
due from an associate (Note 23) 37,940 - - -
Reversal of impairment loss on amount
due from subsidiaries (Note 24) - - 38,268 -
Reversal of provision for doubtful debt 15,833 15,425 - 15,425
239,592 34,328,563 224,087 34,414,146

158 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

11. Finance income/(costs) and net foreign exchange loss

Group Company

1.1.2023 1.7.2021 1.1.2023 1.7.2021

to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

(a) Finance income:

Interest income from deposits with

licensed bank 2,583 1,548 2,583 1,548
Other interest income 119 - 119 -
2,702 1,548 2,702 1,548
Effect of discounting on financial
instruments - 5 - 5
2,702 1,553 2,702 1,553

(b) Finance costs:

Interest expense on lease liabilities

(Note 31) (94,571) (753,580) (94,571) (753,580)
Bank facilities and other charges (2,820) (939) (2,820) (939)
(97,391) (754,519) (97,391) (754,519)
Impact of discounting effect on
financial instruments (15,210) (8,448) (15,210) (8,448)
(112,601) (762,967) (112,601) (762,967)

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

(c) Net foreign exchange gain/(loss):

Realised 38,703 (13,643) 38,703 (13,643)

Unrealised (63,998) (34,099) (63,998) (34,099)
(25,295) (47,742) (25,295) (47,742)

2023 Annual Report 159

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

12. Other loss

Group and Company

2023 2022
RM’000 RM’000
Restated

Provision for profit sharing - 46,000

13. Taxation

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Current taxation:
Malaysian income tax 1,936 (1) 1,936 (1)

Deferred taxation:
Relating to origination and reversal of
temporary differences 10,332 (612,240) 10,332 (612,240)
Total income tax expense/(benefit) 12,268 (612,241) 12,268 (612,241)

The Group and Company are subject to income tax on an entity basis on the profit arising in or derived
from the tax jurisdictions in which members of the Group and of the Company are domiciled and operate.

Domestic current income tax is calculated at the statutory tax rate of 24% (2022: 24%) of the estimated
assessable profit for the period.

160 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

13. Taxation (Cont’d.)

A reconciliation of income tax expense applicable to profit before taxation at the statutory income tax rate
to income tax expense at the effective income tax rate of the Group and of the Company is as follows:

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Profit before taxation 343,773 32,696,344 345,340 32,791,045

Tax at Malaysian statutory tax rate of

24% (2022: 24%) 82,506 7,847,123 82,882 7,869,851
Expenses not deductible for tax
purposes 12,070 74,401 11,694 72,561
Income not subject to tax (71,076) (2,016,888) (71,076) (2,037,776)
Utilisation of previously unrecognised
unabsorbed capital allowance - 385 - 385
Utilisation of previously unrecognised
temporary differences (11,232) (6,341,891) (11,232) (6,341,891)
Deferred tax assets recognised - (731,370) - (731,370)
Deferred tax assets not recognised - 555,999 - 555,999
Total tax expense/(benefit) 12,268 (612,241) 12,268 (612,241)

Deferred tax assets not recognised in respect of the following items:

Group and Company

1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
RM’000 RM’000

Other temporary differences 102,038 148,838

102,038 148,838

Effective from the year of assessment 2019 in accordance to the Income Tax Act 1967, any unutilised tax
losses of the Company as at 30 June 2021 for the year of assessment 2021 will only be made available for
utilisation for tenth (10) consecutive years of assessment, i.e. from the year of assessment 2021 until the
year of assessment 2031. Any unutilised tax losses after year of assessment 2031 shall be disregarded.
Unabsorbed capital allowances, unutilised investment tax allowances and other deductible temporary
differences do not expire under current tax legislation.

2023 Annual Report 161

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

13. Taxation (Cont’d.)

Year of expiry of unutilised tax losses is analysed as follow:

Group and Company

RM’000 RM’000

Expired in 2031 718,256 843,729

Estimating the future taxable profits involves significant assumptions, especially in respect of fares, load
factor, fuel price, maintenance costs and currency movements. These assumptions have been built based
on past performance and adjusted for non-recurring circumstances and a reasonable growth rate.

During the previous financial period, certain subsidiaries of the Company incorporated in Labuan, Wilayah
Persekutuan had irrevocably elected to adopt Income Tax Act effective for the financial year ended
31 December 2022.

14. Earnings per share (sen)

(a) Basic earnings per share

Basic earnings per share is calculated by dividing the earnings for the financial year by the weighted
average number of ordinary shares in issue during the financial year.

Group
1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
Restated

Earnings for the financial period (RM’000) 331,505 33,308,585

Weight average number of ordinary shares in issue (’000) 447,073 414,815
Earnings per share (sen) 74.2 8,029.7

(b) Diluted earnings per share

The diluted earnings per share of the Group is identical to the basic earnings per share as the Group
has no dilutive potential ordinary shares as at the end of the reporting date. There has been no other
transaction involving ordinary shares or potential ordinary shares between the reporting date and
the date of authorisation of these financial statements.

162 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

15. Property, plant and equipment

Aircraft
engines, Office
airframes equipment,
and service Aircraft furniture Pre-delivery
potential spares and fittings payments Total
RM’000 RM’000 RM’000 RM’000 RM’000
Restated

Group and Company

2023

Net book value

At 1 January 2023 2,815 38,273 760 - 41,848

Additions - 15,254 - - 15,254
Depreciation (Note 6) (1,714) (19,425) (668) - (21,807)
At 31 December 2023 1,101 34,102 92 - 35,295

2022

Net book value

At 1 July 2021 - - - - -
Additions - 2,018 3 - 2,021
Reversal of impairment
loss (Note 9) 2,815 36,255 757 117,189 157,016
Reclassification - - - (117,189) (117,189)
At 31 December 2022 2,815 38,273 760 - 41,848

2023 Annual Report 163

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

15. Property, plant and equipment (Cont’d.)

The reconciliation of the gross carrying amount and the accumulated depreciation at the beginning and
end of the financial period is as follows:

Aircraft
engines, Office
airframes equipment,
and service Aircraft Motor furniture
potential spares vehicles and fittings Total
RM’000 RM’000 RM’000 RM’000 RM’000

Group and Company

2023

Cost 9,784 170,862 2,778 18,185 201,609

Accumulated
depreciation (8,683) (136,760) (2,778) (18,093) (166,314)
1,101 34,102 - 92 35,295

2022

Cost 9,784 155,608 2,778 18,452 186,622

Accumulated
depreciation (6,969) (117,335) (2,778) (17,692) (144,774)
2,815 38,273 - 760 41,848

164 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

16. Right-of-use assets

The Group and the Company lease various aircraft and engines used in its operations. Leases of aircraft
and engines generally have lease terms between 1 to 14 years. The Group’s and the Company’s obligations
under these leasing arrangement are secured by the lessors’ title to the leased assets.

In the previous financial period, the Group and the Company held leases of office space with lease terms
of 12 months or less and leases of office equipment with low value. The Group and the Company applied
the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these leases.

Set out below are the carrying amounts of right-of-use assets recognised and the movements during the
period:

Aircraft
and engines
RM’000
Restated

Group and Company

As at 1 January 2023, as per previously stated 1,013,394

Prior year adjustment (Note 45) 30,918
As at 1 January 2023, restated 1,044,312
Additions 414,063
Remeasurement 3,914
Depreciation expense (Note 6) (162,588)
Discounting effect (Note 11) 6,747
As at 31 December 2023 1,306,448

As at 1 July 2021 -
Additions 1,084,582
Depreciation expense (Note 6) (40,270)
As at 31 December 2022, restated 1,044,312

The following are the amounts recognised in profit or loss:

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Depreciation on right-of-use assets

(Note 6) 162,588 40,270 162,588 40,270
Rental expense (Note 9) 2,869 1,991 2,869 1,991
Total amount recognised in profit or loss 165,457 42,261 165,457 42,261

2023 Annual Report 165

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

17. Deferred tax assets

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

At 1 January/1 July (612,240) - (612,240) -

Recognised in profit or loss (Note 13) 10,332 (612,240) 10,332 (612,240)
At 31 December (601,908) (612,240) (601,908) (612,240)

Presented after appropriate offsetting

as follows:
Deferred tax assets (920,749) (870,844) (920,749) (870,844)
Deferred tax liabilities 318,841 258,604 318,841 258,604
(601,908) (612,240) (601,908) (612,240)

The components and movements of deferred tax assets and liabilities during the financial period prior to
offsetting are as follows:

Deferred tax assets of the Group:

Unutilised
tax losses,
investment
allowances
and capital Sales in
allowances advance Total
RM’000 RM’000 RM’000

At 1 January 2023 (692,401) (178,443) (870,844)

Recognised in profit or loss (68,120) 18,215 (49,905)
At 31 December 2023 (760,521) (160,228) (920,749)

Deferred tax liabilities of the Group:

Others Total
RM’000 RM’000

At 1 January 2023 258,604 258,604

Recognised in profit or loss 60,237 60,237
At 31 December 2023 318,841 318,841

166 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

17. Deferred tax assets (Cont’d.)

The components and movements of deferred tax assets and liabilities during the financial period prior to
offsetting are as follows:

Deferred tax assets of the Company:

Unutilised
tax losses,
investment
allowances
and capital Sales in
allowances advance Total
RM’000 RM’000 RM’000

At 1 January 2023 (692,401) (178,443) (870,844)

Recognised in profit or loss (68,120) 18,215 (49,905)
At 31 December 2023 (760,521) (160,228) (920,749)

Deferred tax liabilities of the Company:

Others Total
RM’000 RM’000

At 1 January 2023 258,604 258,604

Recognised in profit or loss 60,237 60,237
At 31 December 2023 318,841 318,841

Deferred tax assets are mainly originating from unutilised tax incentives, unabsorbed capital allowances
and tax losses carry forward. As disclosed in Note 3(i), deferred tax assets are recognised to the extent
that it is probable that future taxable profits will be available against which temporary differences can
be utilised. Estimating the future taxable profits involves significant assumptions, especially in respect of
regulatory approvals for prospective routes, aircraft delivery, fares, load factors, fuel price, maintenance
cost and currency movements. These assumptions have been built based on past performance and adjusted
for non-recurring circumstances and a reasonable growth rate. Based on these projections, management
believes that these temporary differences will be utilised and has recognised the deferred tax assets as at
reporting date.

2023 Annual Report 167

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

18. Investments in subsidiaries

Company
2023 2022
RM’000 RM’000

Unquoted investments, at cost 4 4

The details of the subsidiaries are as follows:

Country of
Group’s effective
incorporation/
equity interest
Principal place
Name of business 2023 2022 Principal activities
% %

AirAsia X Services Pty Ltd* Australia 100 100 Provision of management logistical
and marketing services

AAX Mauritius One Mauritius 100 100 Provision of aircraft leasing facilities
Limited*

AAX Aviation Capital Ltd* Malaysia 100 100 Holding company of leasing entities

AAX Leasing One Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Two Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Five Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Eight Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Ten Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Eleven Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

168 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

18. Investments in subsidiaries (Cont’d.)

The details of the subsidiaries are as follows (Cont’d):

Country of
Group’s effective
incorporation/
equity interest
Principal place
Name of business 2023 2022 Principal activities
% %

AAX Leasing Twelve Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Thirteen Ltd*^ Malaysia 100 - Provision for aircraft leasing facilities

AAX Leasing Fourteen Ltd*^ Malaysia 100 - Provision for aircraft leasing facilities

AAX Leasing Fifteen Ltd* Malaysia 100 100 Provision for aircraft leasing facilities

AAX Leasing Sixteen Ltd*^ Malaysia 100 - Provision for aircraft leasing facilities

AAX Leasing Seventeen Ltd*^ Malaysia 100 - Provision of aircraft leasing facilities

AAX Leasing Eighteen Ltd*^ Malaysia 100 - Provision of aircraft leasing facilities

AAX Leasing Nineteen Ltd*^ Malaysia 100 - Provision of aircraft leasing facilities

* Audited by a firm other than Ernst & Young PLT.

^ Incorporated during the financial year.

During the year, the Company incorporated the following six new subsidiaries in Labuan, Wilayah
Persekutuan:

(i) AAX Leasing Thirteen Ltd

(ii) AAX Leasing Fourteen Ltd
(iii) AAX Leasing Sixteen Ltd
(iv) AAX Leasing Seventeen Ltd
(v) AAX Leasing Eighteen Ltd
(vi) AAX Leasing Nineteen Ltd

2023 Annual Report 169

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

19. Investment in an associate

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Unquoted investments, at cost 21,122 21,122 21,122 21,122

Group’s share of post-acquisition losses (21,122) (21,122) - -
Accumulated impairment loss - - (21,122) (21,122)
- - - -

Details of the associate are as follows:

Group’s effective
Country of equity interest
Name incorporation 2023 2022 Principal activity
% %

Thai AirAsia X Co., Thailand 49 49 Commercial air transport services

Ltd (“TAAX”)*

* Audited by a member of Ernst & Young Global.

TAAX is a private company for which there is no quoted market price available for its shares.

TAAX is an operator of commercial air transport services which is based in Thailand. This associated
company is a strategic investment of the Group and forms an essential part of the Group’s growth
strategy. It provides access to a wider geographical market and network coverage in the provision of air
transport services across the ASEAN region. TAAX has undergone a financial rehabilitation plan, which was
approved by the Central Bankruptcy Court of Thailand in September 2023. Under the debt rehabilitation
plan, certain debts were waived and gain arising from the waiver is recognised in the profit and loss.

Set out below is the summarised financial information for the associate which is accounted for using the
equity method:

Summarised statement of financial position

TAAX
2023 2022
RM’000 RM’000

Current:
Cash and cash equivalents 41,580 204,278
Other current assets 624,626 485,460
Total current assets 666,206 689,738

170 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

19. Investment in an associate (Cont’d.)

Set out below is the summarised financial information for the associate which is accounted for using the
equity method: (Cont’d.)

Summarised statement of financial position (Cont’d.)

TAAX
2023 2022
RM’000 RM’000

Non-current:
Assets 761,731 1,162,663

Current:
Financial liabilities - (542,916)
Other current liabilities (1,203,964) (1,943,510)
Total current liabilities (1,203,964) (2,486,426)

Non-current:
Liabilities (805,752) (1,141,210)
Net liabilities (581,779) (1,775,235)

Summarised statement of comprehensive income

TAAX
1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
RM’000 RM’000

Revenue 1,474,053 1,006,211

Other expenses (966,403) (397,525)
Finance income - 11,716
Finance cost (36,118) (63,147)
Other income 115,512 6,487
Gain arising from debt rehabilitation 1,492,657 -
Net foreign exchange gain/(loss) 13,900 (81,664)
Profit before tax 2,093,601 482,078
Taxation 1,107 375
Profit after tax 2,094,708 482,453
Other comprehensive loss - -
Total comprehensive income 2,094,708 482,453

2023 Annual Report 171

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

19. Investment in an associate (Cont’d.)

Set out below is the summarised financial information for the associate which is accounted for using the
equity method (Cont’d.):

Reconciliation of summarised financial information

TAAX
1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
RM’000 RM’000

Opening net liabilities at 1 January/1 July (1,775,235) (2,319,432)

Total comprehensive income for the financial year/period 2,094,708 482,453
Effect on foreign exchange translation (901,252) 61,744
Closing net liabilities at 31 December (581,779) (1,775,235)

Cumulative unrecognised share of losses as at 1 January/1 July (1,367,549) (1,603,951)

Share of gain for the financial year/period 1,026,407 236,402
Cumulative unrecognised share of losses as at 31 December (341,142) (1,367,549)

The Group has discontinued recognition of its share of losses of TAAX because the share of losses of
TAAX has exceeded the Group’s interest in TAAX. As such, during the current financial year, the Group
did not recognise its share of the current financial year net profit of TAAX amounting to RM1,026,407,000
(2022: RM236,402,000) and the Group’s cumulative unrecognised share of losses of TAAX amounted to
RM341,142,000 (2022: RM1,367,549,000).

20. Investment in a joint venture

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Unquoted investments, at cost 53,888 53,888 53,888 53,888

Group’s share of post-acquisition losses (53,888) (53,888) - -
Accumulated impairment losses - - (53,888) (53,888)
- - - -

172 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

20. Investment in a joint venture (Cont’d.)

The details of the joint venture are as follows:

Group’s effective
Country of equity interest
Name incorporation 2023 2022 Principal activity
% %

PT Indonesia AirAsia Extra Indonesia 49 49 Commercial air transport services

(“IAAX”)*

* Audited by a firm other than Ernst & Young PLT.

IAAX is a private company for which there is no quoted market price available for its shares.

The contingent liabilities relating to the Group’s investment in IAAX is disclosed in Note 42.

IAAX is an operator of commercial air transport services which is based in Indonesia. This joint venture
company is a strategic investment of the Company and forms an essential part of the Company’s growth
strategy. It provides access to a wider geographical market and network coverage in the provision of air
transport services across the ASEAN region.

In previous financial period, impairment losses were recognised due to the continuous losses incurred
by the joint venture. Additional losses were recognised during the financial period ended 31 December
2022 due to the matter discussed in Note 42. During the financial year, the Group has reversed the entire
provision for additional loss in the investment in IAAX of RM223.2 million.

Set out below is the summarised financial information for the joint venture which is accounted for using
the equity method:

Summarised statement of financial position

IAAX
31.12.2023 31.12.2022
RM’000 RM’000

Current:
Total current assets 133,518 133,518

Non-current:
Assets 3,008 3,008

Current:
Other current liabilities, representing total current liabilities (624,733) (624,733)

Non-current:
Liabilities 7,121 7,121
Net liabilities (481,086) (481,086)

2023 Annual Report 173

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

20. Investment in a joint venture (Cont’d.)

Set out below is the summarised financial information for the joint venture which is accounted for using
the equity method: (Cont’d.)

Summarised statement of comprehensive income

IAAX
1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
RM’000 RM’000

Cost of sales - (124)

Other operating expenses - (87)
Net foreign exchange gain - 67
Loss after tax - (144)
Other comprehensive loss - -
Total comprehensive loss - (144)
Dividend received from joint venture - -

Reconciliation of summarised financial information

IAAX
1.1.2023 1.7.2021
to to
31.12.2023 31.12.2022
RM’000 RM’000

Opening net liabilities at 1 January/1 July (481,086) (470,016)

Total comprehensive loss for the financial period - (144)
Foreign exchange translation - (10,926)
Closing net liabilities at 31 December (481,086) (481,086)

Cumulative unrecognised share of losses as at 1 January/1 July (282,902) (282,831)

Share in loss for the financial period - (71)
Cumulative unrecognised share of losses as at 31 December (282,902) (282,902)

174 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

21. Inventories

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

At cost
Consumables and in-flight merchandise 6,968 9,190

Cost of inventories recognised as an expense during the financial year amounted to RM16,437,745 (2022:
RM4,802,402).

22. Trade and other receivables

Group Company
Note 31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Non-current
Deposits (c) 321,492 221,318 321,492 221,318
Prepayments (d) 114,774 12,930 114,774 12,930
436,266 234,248 436,266 234,248

Current
Trade receivables 38,793 58,032 38,793 58,032
Less: Allowance for expected
credit losses (1,249) (8,883) (1,249) (8,883)
Trade receivables, net (a) 37,544 49,149 37,544 49,149

Other receivables 411,362 452,550 409,646 387,439

Less: Allowance for expected
credit losses (396,477) (380,511) (396,477) (380,511)
(b) 14,885 72,039 13,169 6,928

Deposits 127,249 64,783 127,249 17,930

Less: Allowance for expected
credit losses (1,991) (2,151) (1,991) (2,151)
(c) 125,258 62,632 125,258 15,779

Prepayments (d) 46,923 46,814 46,896 42,366

Other receivables, net 187,066 181,485 185,323 65,073
224,610 230,634 222,867 114,222

2023 Annual Report 175

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

22. Trade and other receivables (Cont’d.)

Group Company
Note 31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Total trade and other receivables 660,876 464,882 659,133 348,470

Add: Deposits, cash and bank
balances 29 57,689 176,710 57,113 176,373
Amount due from
subsidiaries 24 - - 32,830 -
Amount due from an
associate 23 32,641 29 - -
Amount due from related
parties 25 435,550 131,848 435,413 132,580
Less: Prepayments (161,697) (59,744) (161,670) (55,296)
Total financed assets carried at
amortised cost 39(a) 1,025,059 713,725 1,022,819 602,127

The normal trade credit terms of the Group and of the Company range from 15 to 30 days (2022: 15 to 30
days). Trade receivables comprised mainly amounts due from travel agents and credit card merchants.

(a) Trade receivables

(i) Credit risk

The ageing of trade receivables as at the end of the financial year was:

Group and Company

Gross
carrying Individual Net
amount impairment balance
RM’000 RM’000 RM’000

2023

Current (not past due) 37,228 - 37,228

1 to 30 days past due - - -
31 to 60 days past due 125 - 125
61 to 90 days past due 9 - 9
More than 90 days past due 1,431 (1,249) 182
38,793 (1,249) 37,544

176 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

22. Trade and other receivables (Cont’d.)

(a) Trade receivables (Cont’d.)

(i) Credit risk (Cont’d.)

The ageing of trade receivables as at the end of the financial year was (Cont’d.):

Group and Company

Gross
carrying Individual Net
amount impairment balance
RM’000 RM’000 RM’000

2022

Current (not past due) 38,138 - 38,138

1 to 30 days past due - - -
31 to 60 days past due 922 - 922
61 to 90 days past due 2,784 - 2,784
91 to 120 days past due 5,870 - 5,870
121 to 180 days past due 1,214 - 1,214
More than 180 days 9,104 (8,883) 221
58,032 (8,883) 49,149

The carrying amounts of trade receivables individually determined to be impaired are as follows:

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

More than 180 days 1,249 8,883

Less: Allowance for expected credit losses of receivables (1,249) (8,883)
- -

The individually impaired trade receivables relate mainly to disputed balances with customers or
balances for which management is of the view that the amounts may not be recoverable.

2023 Annual Report 177

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

22. Trade and other receivables (Cont’d.)

(a) Trade receivables (Cont’d.)

Movements on the allowance for impairment of trade receivables are as follows:

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

At 1 January 2023/1 July 2021 8,883 7,397

Written off (8,342) -
Charged to profit or loss (Note 9) 708 1,486
At 31 December 1,249 8,883

(b) Other receivables

Other receivables include other debtors and refunds of goods and service tax receivable from the
authorities in various countries in which the Group and the Company operate.

(i) Credit risk

Movements on the allowance for impairment of other receivables are as follows:

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

At 1 January 2023/1 July 2021 380,511 297,601

Written off (180) (1,486)
Charged to profit or loss (Note 9) 16,146 84,396
At 31 December 396,477 380,511

Deposits of the Group and of the Company at the reporting date are with a number of external
parties.

Deposits include security deposits paid to lessors for leased aircraft, funds placed with lessor in
respect of maintenance of the leased aircraft and deposits for acquisition of aircraft. These deposits
are denominated in USD.

178 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

22. Trade and other receivables (Cont’d.)

(d) Prepayments

Prepayments include prepayments for maintenance of aircraft, advances made for purchases of
fuel, lease of aircraft and maintenance of engines.

The other classes within receivables do not contain impaired assets.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of
receivables mentioned above. The Group and the Company do not hold any collateral as security.

The currency profile of trade and other receivables (excluding prepayments) are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Ringgit Malaysia 35,755 42,888 35,755 42,888

US Dollar 454,415 348,230 454,415 236,266
Australian Dollar 4,900 424 3,184 424
Indian Rupee 1,610 1,671 1,610 1,671
Chinese Renminbi 192 1,924 192 1,924
Japanese Yen 1,482 227 1,482 227
Others 825 9,774 825 9,774
499,179 405,138 497,463 293,174

23. Amount due from an associate

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Non-current
Amount due from an associate 787,801 - - -
Less: Allowance for expected credit
losses of amount due from an
associate (755,160) - - -
32,641 - - -

Current
Amount due from an associate - 755,518 - -
Less: Allowance for expected credit
losses of amount due from an
associate - (755,489) - -
- 29 - -

2023 Annual Report 179

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

23. Amount due from an associate (Cont’d.)

Movements on allowance for impairment of amount due from an associate is as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

At 1 January 2023/1 July 2021 (755,489) (389,329) - -

Reversal of/(allowance for) expected
credit losses (Note 9 & Note 10) 37,940 (366,160) - -
Foreign exchange loss (Note 11) (31,722) - - -
Accretion of interest (Note 11) (5,889) - - -
At 31 December (755,160) (755,489) - -

The amount due from an associate, Thai AirAsia X Co., Ltd, is unsecured, bearing effective weighted
average interest rate of 10.6% per annum and repayable over 5 years. The Group reversed allowance for
impairment of loss of RM37.9 million in respect of the amount due from TAAX during the financial year, in
accordance with the terms of the debt rehabilitation plan detailed in Note 19.

The currency profile of amount from an associate are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

US Dollar 32,610 - - -
Others 31 29 - -
32,641 29 - -

180 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

24. Amount due from subsidiaries

Company
31.12.2023 31.12.2022
RM’000 RM’000

Non-current

Amount due from subsidiaries 788,249 -

Less: Allowance for expected credit losses of amount due from
subsidiaries (755,988) -
32,261 -

Current

Amount due from subsidiaries 19,400 773,991

Less: Allowance for expected credit losses of amount due from
subsidiaries (18,831) (773,991)
569 -

Movements on allowance for impairment of amount due from subsidiaries is as follows:

Company
31.12.2023 31.12.2022
RM’000 RM’000

At 1 January 2023/1 July 2021 (773,991) (391,129)

Reversal of/(allowance for) expected credit losses (Note 9 & Note 10) 38,268 (382,862)
Foreign exchange loss (Note 11) (33,207) -
Accretion of interest (Note 11) (5,889) -
At 31 December (774,819) (773,991)

The amount due from subsidiaries are unsecured, interest free and repayable on demand. The currency
profile of amount from subsidiaries are as follows:

Company
31.12.2023 31.12.2022
RM’000 RM’000

US Dollar 32,830 -

2023 Annual Report 181

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

25. Amount due from related parties

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Non-current

Amount due from related parties 24,960 - 24,960 -

Less: Allowance for impairment of
amount due from related parties (3,025) - (3,025) -
21,935 - 21,935 -

Current

Amount due from related parties 413,988 134,748 413,851 135,480

Less: Allowance for expected credit
losses of amount due from related
parties (373) (2,900) (373) (2,900)
413,615 131,848 413,478 132,580

The increase in amount due from AirAsia Berhad is mainly due to the recovery of the aviation sector post
Covid 19. It represents unremitted collection from sale of scheduled flights. The ageing analysis of these
debts are as follows:

Group and
Company
Carrying
amount
RM’000

2023

1 to 30 days past due 155,591

31 to 60 days past due 72,125
61 to 90 days past due 63,463
91 to 120 days past due 32,880
324,059

2022

1 to 30 days past due 51,360

31 to 60 days past due 15,474
61 to 90 days past due 6,604
91 to 120 days past due 363
73,801

182 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

25. Amount due from related parties (Cont’d.)

Movements on allowance for impairment of amount due from related parties is as follows:

Group Company
RM’000 RM’000 RM’000 RM’000

At 1 January 2023/1 July 2021 (2,900) (12,188) (2,900) (12,188)

(Allowance for)/reversal of expected
credit losses (Note 9) (498) 9,288 (498) 9,288
At 31 December (3,398) (2,900) (3,398) (2,900)

The amount due from related parties are unsecured, interest free and repayable on demand.

The currency profile of amount from related parties are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Ringgit Malaysia 337,388 109,599 337,388 110,331

US Dollar 98,162 1,357 98,025 1,357
Chinese Renminbi - 1,902 - 1,902
Others - 18,990 - 18,990
435,550 131,848 435,413 132,580

26. Amount due to an associate

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Current
Amount due to an associate (4,603) (3,380) (4,603) (3,380)

The amount due to an associate, Thai AirAsia X Co., Ltd is unsecured, interest free and repayable on demand.

The currency profile of amount due to an associate is as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

US Dollar (4,603) (3,380) (4,603) (3,380)

2023 Annual Report 183

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

27. Amount due to subsidiaries

Company
31.12.2023 31.12.2022
RM’000 RM’000

Amount due to subsidiaries (11,809) (635)

The amount due to subsidiaries are unsecured, interest free and repayable on demand.

The currency profile of amount due to subsidiaries are as follows:

Company
31.12.2023 31.12.2022
RM’000 RM’000

US Dollar (11,596) (331)

Others (213) (304)
(11,809) (635)

28. Amount due to related parties

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Amount due to related parties (41,401) (8,469) (41,401) (8,469)

The amount due to related parties are unsecured, interest free and repayable on demand. The balances
arose from trade purchases of ground handling services, provision of shared services, inflight costs and
the increase is in line with the recovery of the aviation section post Covid 19.

The currency profile of amount due to related parties are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Ringgit Malaysia (40,298) (6,546) (40,298) (6,546)

US Dollar (406) (1,829) (406) (1,770)
Chinese Renminbi (697) (94) (697) (153)
(41,401) (8,469) (41,401) (8,469)

184 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

29. Deposits, cash and bank balances

For the purposes of the statements of cash flows, cash and cash equivalents include the following:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Cash and bank balances 57,689 18,632 57,113 18,295

Deposits with licensed banks - 158,078 - 158,078
Total deposits, cash and bank balances 57,689 176,710 57,113 176,373

The currency profile of deposits, cash and bank balances are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Ringgit Malaysia 13,341 130,423 13,341 130,414

US Dollar 3,792 3,449 3,792 3,394
Australian Dollar 5,765 23,614 5,189 23,312
Euro 375 145 375 145
Indian Rupee 19,011 2,667 19,011 2,667
Chinese Renminbi 4,852 104 4,852 104
Japanese Yen 480 1,395 480 1,395
Others 10,073 14,913 10,073 14,942
57,689 176,710 57,113 176,373

2023 Annual Report 185

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

29. Deposits, cash and bank balances (Cont’d.)

Reconciliation of movement of liabilities to cash flows arising from financing activities are as follows:

Lease Hire
Liabilities Term loans purchase Total
Group RM’000 RM’000 RM’000 RM’000

Balance as at 1 July 2021 6,473,678 292,916 15 6,766,609

Changes from financing cash flows

Additions 1,052,998 - - 1,052,998
Lease modification (84,734) - - (84,734)
Finance costs (Note 11) 753,580 - - 753,580
Repayment of borrowings (20,084) - (15) (20,099)
Settlement via redelivery of the aircraft - (292,916) - (292,916)
Debt Restructuring (7,117,871) - - (7,117,871)
Total changes from financing cash flows 1,057,567 - - 1,057,567

Other changes Liability-related

Unrealised foreign exchange loss 4,915 - - 4,915
Balance as at 31 December 2022 1,062,482 - - 1,062,482

Company

Balance as at 1 July 2021 6,558,412 292,916 15 6,851,343

Changes from financing cash flows

Additions 1,052,998 - - 1,052,998
Finance costs (Note 11(b)) 753,580 - - 753,580
Payments (20,084) - (15) (20,099)
Settlement via redelivery of the aircraft - (292,916) - (292,916)
Debt restructuring (7,287,339) - - (7,287,339)
Total changes from financing cash flows 1,057,567 - - 1,057,567

Other changes Liability-related

Unrealised foreign exchange loss 4,915 - - 4,915
Balance as at 31 December 2022 1,062,482 - - 1,062,482

186 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

30. Trade and other payables

Group Company
Note 31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Current
Trade payables (a) 63,302 92,362 58,092 91,095
Other payables and accruals (b) 296,930 336,805 268,824 209,426
360,232 429,167 326,916 300,521

Total trade and other payables 360,232 429,167 326,916 300,521

(a) Trade payables

The credit term of trade payables granted to the Group and the Company is 7 to 30 days (2022: 7
to 30 days).

(b) Other payables and accruals

Included in other payables and accruals are operational expenses and passenger service charges
payable to airport authorities.

The currency profile of trade and other payables are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Ringgit Malaysia 270,137 157,936 256,739 157,936

US Dollar 90,095 71,872 70,177 71,872
Euro - 279 - 279
Indian Rupee - 2,768 - 2,768
Others - 196,312 - 67,666
360,232 429,167 326,916 300,521

2023 Annual Report 187

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

31. Lease liabilities

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Current
Secured:
- Lease liabilities 152,392 57,033 152,392 57,033

Non-current
Secured:
- Lease liabilities 1,359,633 1,005,449 1,359,633 1,005,449

Total lease liabilities 1,512,025 1,062,482 1,512,025 1,062,482

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
% % % %

Weighted average rate of finance

- Lease liabilities 6.66 6.56 6.66 6.56

The Group’s and Company’s lease liabilities are repayable as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Not later than 1 year 152,392 57,033 152,392 57,033

Later than 1 year and not later than 5
years 760,718 285,165 760,718 285,165
Later than 5 years 598,915 720,284 598,915 720,284
1,512,025 1,062,482 1,512,025 1,062,482

The currency profile of lease liabilities are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

US Dollar 1,512,025 1,062,482 1,512,025 1,062,482

188 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

31. Lease liabilities (Cont’d.)

Lease liabilities pertain to operating leases for aircraft and engines, as disclosed in Note 16. Analysis on the
maturity profile of lease liabilities is disclosed in Note 38(c).

The movement of lease liabilities during the financial period is as follows:

Lease
Liabilities
Group RM’000

Balance as at 1 January 2023 1,062,482

Additions 395,905
Lease remeasurement 4,019
Accretion of interest (Note 11) 94,571
Payments (112,005)
Unrealised foreign exchange loss 67,053
Balance as at 31 December 2023 1,512,025

Group

Balance as at 1 July 2021 6,473,678

Additions 1,052,998
Lease modification (84,734)
Accretion of interest (Note 11) 753,580
Payments (20,084)
Debt Restructuring (7,117,871)
Unrealised foreign exchange loss 4,915
Balance as at 31 December 2022 1,062,482

Company

Balance as at 1 July 2023 1,062,482

Additions 395,905
Lease remeasurement 4,019
Accretion of interest (Note 11) 94,571
Payments (112,005)
Unrealised foreign exchange loss 67,053
Balance as at 31 December 2023 1,512,025

2023 Annual Report 189

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

31. Lease liabilities (Cont’d.)

The movement of lease liabilities during the financial period is as follows (Cont’d.):

Lease
Liabilities
Company RM’000

Balance as at 1 July 2021 6,558,412

Additions 1,052,998
Accretion of interest (Note 11) 753,580
Payments (20,084)
Debt restructuring (7,287,339)
Unrealised foreign exchange loss 4,915
Balance as at 31 December 2022 1,062,482

32. Other provisions

(a) Provision for additional loss in the investment in IAAX

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

Non-current
At 1 January/1 July 223,245 -
(Reversal of)/provision for additional loss (223,245) 223,245
At 31 December - 223,245

Details of the provision for additional losses in the investment in IAAX is disclosed in Note 42.

(b) Provision for profit-sharing

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000
Restated

Current 13,000 13,000

Non-current 33,000 33,000
46,000 46,000

190 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

32. Other provisions (Cont’d.)

(b) Provision for profit-sharing (Cont’d.)

The Group and the Company have a present obligation to pay the profit-sharing that will be triggered
by generation of EBITDAR in a future period as a result of AAX being economically compelled to
continue to operate in that future period.

33. Provision for aircraft maintenance

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

Aircraft maintenance provision

Current 57,747 17,869 57,747 17,674
Non-current 331,774 207,899 331,774 207,899
389,521 225,768 389,521 225,573

The movements in the provision account are as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000
Restated Restated

At 1 January/1 July 225,768 961,250 225,573 961,250

Additions during the financial year/
period 163,753 455,863 163,948 455,668
Waiver during the financial period - (1,191,345) - (1,191,345)
At 31 December 389,521 225,768 389,521 225,573

2023 Annual Report 191

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

34. Sales in advance

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Current 612,296 391,373 612,296 391,373

Non-current 55,320 352,139 55,320 352,139
Total 667,616 743,512 667,616 743,512

Included in sales in advance in the current financial period is the provision of travel vouchers of RM175.8
million (2022: RM434.0 million) relating to promotional air travel privileges to its passengers at the
discretion of the Group.

In compliance with the scheme of arrangement, such travel privileges were provided to qualified passengers
in the form of travel vouchers. Qualified passengers can utilise the travel voucher in exchange for flight
arrangement from the Group of up to the equivalent value of the travel voucher subject to terms and
conditions as determined by the Group base on prevailing business operations environment, and subject
to change from time to time.

The travel voucher currently has a validity period of 5 years from the issuance date. In compliance with the
Sanction Order, there is no cash refund at any time for any unused travel voucher.

All performance obligations are expected to be fulfilled within a year except for the non-current portion
which is expected to be fulfilled between two and four years (2022: two and five years).

35. Share capital

Group and Company

31.12.2023 31.12.2022 31.12.2023 31.12.2022
’000 ’000 RM’000 RM’000

Issued and fully paid up:

At beginning of financial year/period 414,815 4,148,149 1,534 1,534,044
Share consolidation - (3,733,334) - -
Share capital reduction - - - (1,532,510)
Issuance of ordinary shares during the
financial year 32,258 - 49,495 -
At end of financial year/period 447,073 414,815 51,029 1,534

On 15 June 2023, the Company has completed a private placement exercise, in which the Company has
issued 32,258,066 new shares with an issue price of RM1.55 per placement price.

On 24 January 2022, the High Court of Malaya approved the petition by the Company to reduce its
share capital pursuant to Section 116 of the Companies Act 2016 in Malaysia from RM1,534,043,652 to
RM1,534,043, represented by 4,148,149,102 ordinary shares of RM0.00037 per share.

On 14 February 2022, the Company announced the completion of the consolidation of 10 existing shares
in the Company into 1 ordinary share resulting in the reduction in the number of shares from 4,148,149,102
ordinary shares of RM0.00037 each to 414,814,737 ordinary shares of RM1 each.

192 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

36. Capital commitments

Capital commitments not provided for in the financial statements are as follows:

Group and Company

31.12.2023 31.12.2022
RM’000 RM’000

Property, plant and equipment approved and contracted for:

- within 1 year 355,701 49,256
- later than 1 year and not later than 5 years 3,089,399 2,232,412
- later than 5 years 533,502 1,522,460
3,978,602 3,804,128

The approved and contracted capital commitments for the Group and the Company are in respect of
aircraft purchase.

37. Significant related party transactions

In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are
other significant related party disclosures.

The related parties of the Group and of the Company and their relationships at 31 December 2023 are as
follows:

Name of Companies Relationship

Thai AirAsia X Co., Ltd Associate
PT Indonesia AirAsia Extra Joint Venture
AirAsia Berhad Shareholder of the Company for which there is no
control, significant influence or joint control; common
Directors and shareholders

Subsidiaries of Capital A Berhad

- AirAsia SEA Sdn Bhd Common Directors and shareholders
- Rokki Sdn Bhd Common Directors and shareholders
- BIGLIFE Sdn Bhd Common Directors and shareholders
- Ground Team Red Sdn Bhd Common Directors and shareholders
- Teleport Everywhere Pte Ltd Common Directors and shareholders
- AirAsia (Guangzhou) Aviation Service Limited Common Directors and shareholders
- Santan Food Sdn Bhd Common Directors and shareholders
- Santan Restaurant Sdn Bhd Common Directors and shareholders
- Ikhlas Com Travel Sdn Bhd Common Directors and shareholders

2023 Annual Report 193

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

37. Significant related party transactions (Cont’d.)

The related parties of the Group and of the Company and their relationships at 31 December 2023 are as
follows: (Cont’d.)

Name of Companies Relationship

Subsidiaries of Capital A Berhad (Cont’d.)
- Redbeat Academy Sdn Bhd Common Directors and shareholders
- AirAsia Digital Sdn Bhd Common Directors and shareholders
- AirAsia Com Travel Sdn Bhd Common Directors and shareholders
- AirAsia Ride Sdn Bhd Common Directors and shareholders
- Asia Digital Engineering Sdn Bhd Common Directors and shareholders
- Capital A Berhad Common Directors and shareholders

Associates of Capital A Berhad

- Thai AirAsia Co. Ltd Common Directors and shareholders
- PT Indonesia AirAsia Common Directors and shareholders
- Philippines AirAsia Inc Common Directors and shareholders

Other related entities

- Ormond Lifestyle Services Sdn Bhd Common Directors and shareholders
- Tune Insurance Malaysia Berhad Common Directors and shareholders

All related party transactions were carried out on agreed terms and conditions.

Key management personnel are categorised as head or senior management officers of key operating
divisions within the Group and the Company. The key management compensation is disclosed in Note 37(f).

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

(a) Income:

Aircraft operating lease income for

leased aircraft
- AAX Mauritius One Limited - - - 143,701
- Thai AirAsia X Co., Ltd - 143,701 - -

Commission on travel insurance

for passengers charged to Tune
Insurance Malaysia Berhad 1,617 - 1,617 -

Sale of cargo transportation to

Teleport Everywhere Pte Ltd 151,673 346,197 151,673 346,197

194 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

37. Significant related party transactions (Cont’d.)

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

(b) Recharges:

Recharges of expenses to
- Philippines AirAsia Inc 585 595 585 595
- Thai AirAsia Co. Ltd 84 11,990 84 11,990
- PT Indonesia AirAsia - 5,897 - 5,897
- Thai AirAsia X Co., Ltd 569 4,951 569 4,951
- PT Indonesia AirAsia Extra - 536 - 536
- AirAsia (Guangzhou) Aviation
Service Limited (14) 1,068 (14) 1,068
- AirAsia SEA Sdn Bhd (864) 1,001 (864) 1,001
- Ground Team Red Sdn Bhd 154 15,979 154 15,979

Recharges of expenses by
- AirAsia Berhad (7,985) (4,275) (7,985) (4,275)
- PT Indonesia AirAsia (271) - (271) -

(c) Other charges:

Management fees charged by AirAsia

X Services Pty Ltd (Note 9) 443 (229) (3,458) (1,838)

In-flight entertainment system and

software expense charged by
Rokki Sdn Bhd - 1,972 - 1,972

Shared service management fee

charged by AirAsia SEA Sdn Bhd (6,546) (4,819) (6,546) (4,819)

Provision of food catering services

charged by Ormond Lifestyle
Services Sdn Bhd 2,064 - 2,064 -

Ground handling services charged

by Ground Team Red Sdn Bhd (22,489) (6,157) (22,489) (6,157)

Turnaround charges charged by

AirAsia (Guangzhou) Aviation
Service Limited (1,630) (105) (1,630) (105)

2023 Annual Report 195

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

37. Significant related party transactions (Cont’d.)

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

(d) Receivables:

- AAX Mauritius One Limited - - 32,261 -

- PT Indonesia AirAsia 20,601 - 20,464 562
- Thai AirAsia X Co., Ltd 32,641 29 - -
- Airasia Com Travel Sdn Bhd - 7,491 - 7,491
- Ikhlas Com Travel Sdn Bhd 4,416 6,277 4,416 6,277
- AirAsia Berhad 324,059 73,801 324,059 73,801
- Teleport Everywhere Pte Ltd 26,296 43,157 26,296 43,157
- Thai AirAsia Co. Ltd 53,505 - 53,505 -
- Airasia Aviation Management
Services Sdn. Bhd. 4,147 - 4,147 -
- Others 2,526 1,122 3,095 1,292
468,191 131,877 468,243 132,580

(e) Payables:

- Thai AirAsia X Co., Ltd 4,603 3,380 4,603 3,380

- AirAsia Leasing Eleven Ltd - - 9,673 -
- AirAsia Leasing Seventeen Ltd - - 1,450 -
- AirAsia Sea 3,141 3,720 3,141 3,720
- Thai AirAsia Co. Ltd - 1,807 - 1,807
- Ground Team Red Sdn Bhd 4,948 1,123 4,948 1,123
- AirAsia Com Travel Sdn Bhd 12,903 - 12,903 -
- Santan Restaurant Sdn Bhd 10,139 - 10,139 2
- Asia Digital Engineering Sdn Bhd 5,628 1,236 5,628 1,236
- Tune Protect Malaysia 3,445 - 3,445 -
- Others 1,197 583 1,883 1,216
46,004 11,849 57,813 12,484

196 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

37. Significant related party transactions (Cont’d.)

(f) Key management personnel compensation:

Group Company
1.1.2023 1.7.2021 1.1.2023 1.7.2021
to to to to
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Basic salaries, bonus and

allowances 1,350 1,415 1,350 1,415
Defined contribution plan 162 170 162 170
1,512 1,585 1,512 1,585

38. Financial risk management policies

The Group’s and the Company’s financial risk management policies seek to ensure that adequate financial
resources are available for the development of the Group’s and the Company’s businesses whilst managing
their market risk (including fuel price risk, interest rate risk and foreign currency exchange risk), credit risk
and liquidity and cash flow risk. The Group and the Company operate within defined guidelines that are
approved and reviewed periodically by the Board of Directors to minimise the effects of such volatility on
their financial performance.

The Board of Directors is responsible for setting the objectives and underlying principles of financial
risk management for the Group and the Company. The management team then establishes detailed
policies such as risk identification and measurement, exposure limits and risk management strategies. Risk
management policies and procedures are reviewed regularly to reflect changes in the market condition,
and the Group’s and the Company’s activities.

The Group and the Company also seek to ensure that the financial resources that are available for the
development of the Group’s and the Company’s businesses are constantly monitored and managed by
implementing the turnaround plans.

The policies in respect of the major areas of treasury activities are as follows:

(a) Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices such as foreign currency exchange rates, jet fuel prices and
interest rates. The objective of market risk management is to manage and control market risk
exposure within acceptable parameters while optimizing the return on risk.

(i) Foreign currency risk

Apart from Ringgit Malaysia (“RM”), the Group and the Company transact business in various
foreign currencies including United States Dollar (“USD”), Australian Dollar (“AUD”), EURO,
Indian Rupee (“INR”), Chinese Renminbi (“RMB”) and Japanese Yen (“JPY”). Therefore,
the Group and the Company are exposed to currency exchange risk. These exposures are
managed, to the extent possible, by natural hedges that arise when payments for foreign
currency payables are matched against receivables denominated in the same foreign currency,
or whenever possible by intragroup arrangements and settlements.

2023 Annual Report 197

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

38. Financial risk management policies (Cont’d.)

The policies in respect of the major areas of treasury activities are as follows (Cont’d.):

(a) Market risk (Cont’d.)

(i) Foreign currency risk (Cont’d.)

As at 31 December 2023, if RM had weakened/strengthened by 5% against the USD with

all other variables held constant, the impact on the post-tax profit for the financial year are
tabulated below:

2023 2022
Change in USD rate +5% -5% +5% -5%
RM’000 RM’000 RM’000 RM’000

Impact on post tax profit (50,908) 50,908 (45,186) 45,186

The exposure to other foreign currency risk of the Group and the Company is not material
and hence, sensitivity analysis is not presented.

(b) Credit risk

Credit risk is the risk of financial loss to the Group and the Company if a customer or a counter
party to a financial instrument fails to meet its contractual obligations and arises principally from
the Group’s and the Company’s receivables from customers and cash and cash equivalents.

The Group’s and the Company’s exposure to credit risk or the risk of counterparties defaulting arises
mainly from various deposits and bank balances, and receivables. As the Group and the Company
do not hold collateral, the maximum exposure to credit risk is represented by the total carrying
amounts of these financial assets in the financial position. Credit risk, or the risk of counterparties
defaulting, is controlled by the application of credit approvals, limits and monitoring procedures.

Credit risk relating to receivables is minimised by regular monitoring and, in addition, credit risk
is controlled as the majority of the Group’s and the Company’s deposits and bank balances are
placed with major financial institutions and reputable parties. The Directors are of the view that the
possibility of non-performance by the majority of these financial institutions is remote on the basis
of their financial strength and support of their respective governments.

The Group and the Company use a provision matrix to calculate ECLs for trade receivables and
contract assets. The Group and the Company will calibrate the matrix to adjust the historical credit
loss experience with forward-looking information. At every reporting date, the historical observed
default rates are updated and changes in the forward-looking estimates are analysed.

As at the reporting date, the Group’s and the Company’s significant concentration of credit risk
comprised predominantly from the amount due from AAB for unremitted sales in advance collection.
The amount due from AAB is disclosed in Note 25.

198 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

38. Financial risk management policies (Cont’d.)

The policies in respect of the major areas of treasury activities are as follows (Cont’d.):

(c) Liquidity and cash flow risk

The Group’s and the Company’s policy on liquidity risk management is to maintain sufficient cash
and cash equivalents and to have available funding through adequate amounts of committed credit
facilities and credit lines for working capital requirements.

The table below analyses the Group’s and the Company’s financial liabilities into relevant maturity
groupings based on the remaining period at the reporting date to the contractual maturity date.
The amounts disclosed in the table below are the contractual undiscounted cash flows.

Under Over
Note 1 year 1 - 2 years 2 - 5 years 5 years
RM’000 RM’000 RM’000 RM’000

Group

At 31 December 2023

Lease liabilities 31 152,392 304,287 456,431 598,915

Trade and other payables 30 360,232 - - -
Amount due to an
associate 26 4,603 - - -
Amount due to related
parties 28 41,401 - - -
558,628 304,287 456,431 598,915

At 31 December 2022

Lease liabilities 31 57,033 114,066 171,099 720,284

Trade and other payables 30 429,167 - - -
Amount due to an
associate 26 3,380 - - -
Amount due to related
parties 28 8,469 - - -
498,049 114,066 171,099 720,284

2023 Annual Report 199

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

38. Financial risk management policies (Cont’d.)

The policies in respect of the major areas of treasury activities are as follows (Cont’d.):

(c) Liquidity and cash flow risk (Cont’d.)

Under Over
Note 1 year 1 - 2 years 2 - 5 years 5 years
RM’000 RM’000 RM’000 RM’000

Company

At 31 December 2023

Lease liabilities 31 152,392 304,287 456,431 598,915

Trade and other payables 30 326,916 - - -
Amount due to
subsidiaries 27 11,809 - - -
Amount due to an
associate 26 4,603 - - -
Amount due to related
parties 28 41,401 - - -
537,121 304,287 456,431 598,915

At 31 December 2022

Lease liabilities 31 57,033 114,066 171,099 720,284

Trade and other payables 30 300,521 - - -
Amount due to
subsidiaries 27 635 - - -
Amount due to an
associate 26 3,380 - - -
Amount due to related
parties 28 8,469 - - -
370,038 114,066 171,099 720,284

200 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

38. Financial risk management policies (Cont’d.)

The policies in respect of the major areas of treasury activities are as follows (Cont’d.):

(d) Capital risk management

The Group’s and the Company’s objectives when managing capital are to safeguard the Group’s and
the Company’s ability to continue as a going concern in order to provide returns for shareholders
and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost
of capital.

In order to maintain or adjust the capital structure, the Group and the Company may adjust the
amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell
assets to reduce debt.

Consistent with others in the industry, the Group and the Company monitor capital on the basis of
the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated
as total borrowings (including “current and non-current borrowings” as shown in the Group’s and
the Company’s financial position) less cash and cash equivalents. Total capital is calculated as
‘equity’ as shown in the Group’s and the Company’s financial position plus net debt.

The gearing ratio as at 31 December 2023 and 31 December 2022 were as follows:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Lease liabilities (Note 31) 1,512,025 1,062,482 1,512,025 1,062,482

Less: Cash and cash equivalents
(Note 29) (57,689) (176,710) (57,113) (176,373)
Net debt 1,454,336 885,772 1,454,912 886,109
Total equity attributable to equity
holders of the Group and
Company 116,175 (259,229) 135,419 (247,148)
Total capital 1,570,511 626,543 1,590,331 638,961

Gearing ratio 0.93 1.41 0.91 1.39

2023 Annual Report 201

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

38. Financial risk management policies (Cont’d.)

The policies in respect of the major areas of treasury activities are as follows (Cont’d.):

(e) Fair value measurement

The carrying amounts of cash and cash equivalents, trade and other current assets, and trade and
other current liabilities approximate their respective fair values due to the relatively short-term
maturity of these financial instruments. The fair values of other classes of financial assets and
liabilities are disclosed in the respective notes to financial statements.

Determination of fair value and fair value hierarchy

The Group’s and the Company’s financial instruments are measured in the financial position at fair
value. Disclosure of fair value measurements are by level of the following fair value measurement
hierarchy:

- Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

- Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2); and

- Inputs for the asset or liability that are not based on observable market data (that is,
unobservable inputs) (Level 3).

The fair values of the Group’s long-term amounts due from an associate and related parties and
the Company’s long-term amount due from subsidiaries are determined by using the discounted
cashflows method using discount rate that reflects the issuer’s borrowing rate as at the end of the
reporting period.

39. Financial instruments

(a) Financial instruments by category

Group Company
amortised amortised
cost cost
RM’000 RM’000

31 December 2023

Assets as per statement of financial position

Trade and other receivables excluding prepayments 499,179 497,463

Amount due from subsidiaries - 32,830
Amount due from an associate 32,641 -
Amount due from related parties 435,550 435,413
Deposits, cash and bank balances 57,689 57,113
Total 1,025,059 1,022,819

202 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

39. Financial instruments (Cont’d.)

(a) Financial instruments by category (Cont’d.)

Liabilities as per statement of financial position

Group Company
amortised amortised
cost cost
RM’000 RM’000

31 December 2023

Lease liabilities 1,512,025 1,512,025

Trade and other payables 360,232 326,916
Amount due to subsidiaries - 11,809
Amount due to an associate 4,603 4,603
Amount due to related parties 41,401 41,401
Total 1,918,261 1,896,754

31 December 2022

Assets as per statement of financial position

Trade and other receivables excluding prepayments 405,138 293,174

Amount due from an associate 29 -
Amount due from related parties 131,848 132,580
Deposits, cash and bank balances 176,710 176,373
Total 713,725 602,127

Liabilities as per statement of financial position

Lease liabilities 1,062,482 1,062,482

Trade and other payables 429,167 300,521
Amount due to subsidiaries - 635
Amount due to an associate 3,380 3,380
Amount due to related parties 8,469 8,469
Total 1,503,498 1,375,487

2023 Annual Report 203

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

39. Financial instruments (Cont’d.)

(b) Credit quality of financial assets

The credit quality of financial assets that are neither past due nor impaired can be assessed by
reference to external credit ratings (if available) or to historical information about counterparty
default rates:

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Counterparties without external

credit rating

Group 1 - - - -
Group 2 37,228 38,138 37,228 38,138
Total trade receivables that are
neither past due nor impaired
(Note 22 (a)(i)) 37,228 38,138 37,228 38,138

Group Company
Note 31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Deposits, cash and bank

balances

AAA to A- 57,338 176,177 56,762 176,177

BBB to BBB- - 375 - 38
57,338 176,552 56,762 176,215
Cash on hand 351 158 351 158
Total 29 57,689 176,710 57,113 176,373

204 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

39. Financial instruments (Cont’d.)

(b) Credit quality of financial assets (Cont’d.)

Group Company
31.12.2023 31.12.2022 31.12.2023 31.12.2022
RM’000 RM’000 RM’000 RM’000

Amount due from subsidiaries,

an associate, a joint venture
and related parties

Group 1 - - - -
Group 2 468,191 131,877 468,243 132,580
Total 468,191 131,877 468,243 132,580

Group 1 – New customers/related parties (less than 6 months)

Group 2 – Existing customers/related parties (more than 6 months)

All other receivables and deposits are substantially with existing counterparties.

40. Segmental information

Management has determined the operating segments based on reports that are reviewed and used to
make strategic decisions by the Group’s CEO who is identified as the chief operating decision maker.

The Group’s CEO considers the business from a geographic perspective. The operating segments have
been identified by each Air Operator Certificate (“AOC”) held under the AirAsia brand, and are categorised
as Malaysia, Thailand and Indonesia.

The Group’s CEO assesses the performance of the operating segments based on revenue and net operating
profit.

2023 Annual Report 205

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

40. Segmental information (Cont’d.)

The Group’s operations by geographical segments are as follows:

Elimination
Malaysia Thailand adjustments Total
2023 RM’000 RM’000 RM’000 RM’000

Segment results
Revenue 2,527,096 1,474,053 - 4,001,149
Operating expenses
- Staff costs (204,071) (115,339) - (319,410)
- Depreciation (184,395) (70,857) - (255,252)
- Aircraft fuel expenses (1,256,429) (210,631) - (1,467,060)
- Maintenance and overhaul (351,045) (100,245) - (451,290)
- User charges (247,619) (120,572) - (368,191)
- Aircraft operating lease expenses (72,158) - - (72,158)
- Other operating expenses (195,249) (348,759) - (544,008)
- Reversal of additional loss in the
investment in IAAX 223,245 - - 223,245
Other income 239,592 115,512 - 355,104
Gain arising from debt rehabilitation - 1,492,657 - 1,492,657
Operating profit 478,967 2,115,819 - 2,594,786
Finance income 2,702 - - 2,702
Finance costs (112,601) (36,118) - (148,719)
Net operating profit 369,068 2,079,701 - 2,448,769
Net foreign exchange (loss)/gain (25,295) 13,900 - (11,395)
Profit before taxation 343,773 2,093,601 - 2,437,374
Taxation (12,268) 1,107 (11,161)
Profit after taxation 331,505 2,094,708 - 2,426,213

206 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

40. Segmental information (Cont’d.)

The Group’s operations by geographical segments are as follows (Cont’d.):

Elimination
Malaysia Thailand Indonesia adjustments Total
RM’000 RM’000 RM’000 RM’000 RM’000
2022 Restated Restated

Segment results
Revenue 825,860 1,006,211 - - 1,832,071
Operating expenses
- Staff costs (106,442) (25,546) (5) - (131,993)
- Depreciation (40,270) (67,425) (119) - (107,814)
- Aircraft fuel expenses (354,896) (89,598) - - (444,494)
- Maintenance and
overhaul (472,353) (68,731) - - (541,084)
- User charges (96,965) (30,886) - - (127,851)
- Aircraft operating
lease expenses (33,637) (47,817) - - (81,454)
- Other operating
expenses (275,115) (67,522) (87) - (342,724)
- Provision for
additional loss in the
investment in IAAX (223,245) - - - (223,245)
Other income 34,328,563 6,487 - - 34,335,050
Other loss (46,000) - - - (46,000)
Operating profit/(loss) 33,505,500 615,173 (211) - 34,120,462
Finance income 1,553 11,716 - - 13,269
Finance costs (762,967) (63,147) - - (826,114)

2023 Annual Report 207

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

40. Segmental information (Cont’d.)

The Group’s operations by geographical segments are as follows (Cont’d.):

Elimination
Malaysia Thailand Indonesia adjustments Total
RM’000 RM’000 RM’000 RM’000 RM’000
2022 (Cont’d.) Restated Restated

Segment results (Cont’d.)

Net operating profit/

(loss) 32,744,086 563,742 (211) - 33,307,617
Net foreign exchange
(loss)/gain (47,742) (81,664) 67 - (129,339)
Profit/(loss) before
taxation 32,696,344 482,078 - (144) 33,178,278
Taxation 612,241 375 - - 612,616
Profit/(loss) after
taxation 33,308,585 482,453 (144) - 33,790,894

2023

Segment assets

Non-current assets^ 2,434,493 761,731 3,008 - 3,199,232

Current assets 703,080 666,206 133,518 - 1,502,804
3,137,573 1,427,937 136,526 - 4,702,036

Segment liabilities

Non-current liabilities (1,779,727) (805,752) 7,121 - (2,578,358)

Current liabilities (1,241,671) (1,203,964) (624,733) - (3,070,368)
(3,021,398) (2,009,716) (617,612) - (5,648,726)

2022

Segment assets

Non-current assets^ 1,932,648 1,162,663 3,008 (268,288) 2,830,031

Current assets 550,146 689,738 133,518 (152,690) 1,220,712
2,482,794 1,852,401 136,526 (420,978) 4,050,743

208 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

40. Segmental information (Cont’d.)

The Group’s operations by geographical segments are as follows (Cont’d.):

Elimination
Malaysia Thailand Indonesia adjustments Total
RM’000 RM’000 RM’000 RM’000 RM’000
2022 (Cont’d.) Restated

Segment liabilities

Non-current liabilities (1,821,732) (1,141,210) 7,121 23,434 (2,932,387)

Current liabilities (920,291) (2,486,426) (624,733) 152,690 (3,878,760)
(2,742,023) (3,627,636) (617,612) 176,124 (6,811,147)

^ Excluding investment in an associate and a joint venture.

2023 2022
RM’000 RM’000
Restated

(a) Reconciliation of segment revenue to reported revenue:

Segment revenue 4,001,149 1,832,071

Less: Revenue from an associate and a joint venture which were not
consolidated (1,474,053) (1,006,211)
2,527,096 825,860

(b) Reconciliation of segment profit before taxation to reported loss

before taxation:

Segment profit before taxation 2,437,374 33,178,278

Less: Expenses from an associate and a joint venture which were
not consolidated (2,093,601) (481,934)
343,773 32,696,344

(c) Reconciliation of segment assets to reported total assets:

Segment assets 4,702,036 4,050,743

Less: Assets of an associate and a joint venture which were not
consolidated (1,564,463) (1,567,949)
3,137,573 2,482,794

2023 Annual Report 209

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

40. Segmental information (Cont’d.)

2023 2022
RM’000 RM’000

(d) Reconciliation of segment liabilities to reported total liabilities:

Segment liabilities (5,648,726) (6,811,147)

Add: Liabilities of an associate and a joint venture which were not
consolidated 2,627,328 4,069,124
(3,021,398) (2,742,023)

41. Comparative figures

The following comparative amount as at 31 December 2022 has been reclassified to conform with current
year’s presentation.

As
previously As
stated Reclassified restated
RM’000 RM’000 RM’000

Group and Company

Non-current assets

Trade and other receivables (Note 22) 117,059 117,189 234,248

Property, plant and equipment (Note 15) 159,037 (117,189) 41,848

Group

Maintenance and overhaul 490,614 (18,261) 472,353

Finance income (Note 11(a)) (19,814) 18,261 (1,553)

Company

Maintenance and overhaul 490,232 (18,261) 471,971

Finance income (Note 11(a)) (19,814) 18,261 (1,553)

210 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

42. Contingent liabilities

During the financial period ended 31 December 2022, IAAX, a joint venture of the Company, received a Tax
Underpayment Assessment Letter from the Indonesia Tax Office (ITO), demanding a payment of RM200.7
million for tax underpayment in the fiscal year 2017. The tax audit for the year assessment 2018 and 2019
were completed during the financial year and the ITO raised an additional assessment of RM236.6 million.

IAAX has disputed the tax assessments by the ITO and has submitted objection letters and appeal letters
to the ITO. ITO has rejected the appeal by IAAX and the case has been brought to court. In the event
the dispute is ruled in favour of the ITO, it is unlikely that IAAX will be able to pay the additional tax. Per
Indonesian tax regulations, tax collection actions target “tax bearers” of corporate taxpayers, including
shareholders. Consequently, the Company, as IAAX’s shareholder, could be liable for IAAX’s RM215.9
million tax payable, based on its equity interest in IAAX.

In 2023, the Company’s Directors, based on legal opinion provided by external lawyer, believe that it is
not probable that the Company will incur expenses related to IAAX’s tax liability due to the lack of legal
mechanism in Indonesia to effect the reciprocal arrangement with partner countries for cross-border tax
collection assistance. Additionally, cross-border tax collection is not permissible if the tax is in dispute.
IAAX has contested the tax claim and the case is currently pending hearing in Indonesia. Accordingly, this
matter is disclosed as a contingent liability as it gives rise to a possible obligation whose existence will be
confirmed only by the occurrence or non-occurrence of one of more uncertain future events not wholly
within the control of the Company.

43. Events during the reporting period

With the Company’s announcement on 16 March 2022 in relation to the completion of the Restructuring
Scheme, Bursa Malaysia Securities Berhad (“Bursa Securities”) had via its letter dated 16 March 2022
noted that with the completion of the Restructuring Scheme, the Company would have regularised its
financial condition and level of operations and would no longer trigger any criteria under paragraph 2.1 of
Practice Note 17 (“PN 17”) of the Main Market Listing Requirements of Bursa Malaysia.

The upliftment of the Company from PN 17 status was effective on 22 November 2023.

44. Events after the reporting period

On 8 January 2024, AirAsia X has entered into a non-binding letter of acceptance with its related party,
Capital A Berhad (“Capital A”) for the Proposed Acquisitions by AirAsia X of 100% equity interest in
AirAsia Berhad (“AAB”) and 100% equity interest in AirAsia Aviation Group Limited (“AAAGL”), both are
wholly-owned subsidiary of Capital A.

With reference to the Company’s announcement on 25 April 2024, the Company proposed to undertake
several proposals as follows:

(i) Proposed internal reorganisation

(ii) Proposed issuance of free warrants
(iii) Proposed private placement
(iv) Proposed AirAsia Aviation Group Limited (“AAAGL”) acquisition
(v) Proposed AirAsia Berhad (“AAB”) acquisition
(vi) Proposed share capital reduction
(vii) Proposed granting of subscription options

2023 Annual Report 211

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

44. Events after the reporting period (Cont’d.)

As part of the proposed internal reorganisation, all of the Company’s shareholders will exchange their
respective shares in the Company with shares in AirAsia Group Sdn Bhd (“AA Group”). Upon completion of
the proposed internal reorganisation, the Company will become a wholly-owned subsidiary of the AA Group.

In addition, a proposal has been made for the issuance of 223,506,402 warrants on the basis of one warrant
for every two AA Group shares subsequent to the proposed internal reorganisation. A private placement
exercise will also be carried out to raise gross proceeds of RM1,000 million followed by a reduction of the
issued share capital of AA Group to RM100 million via cancellation of paid-up share capital.

AirAsia X proposed to grant subscription option to Garynma Investments Pte Ltd on the rights to subscribe
AA Group shares that represents 15% of the total enlarged issued shares in AA Group subsequent to the
proposed acquisition.

45. Prior year adjustments

(i) The provision for aircraft maintenance as of 31 December 2022 was overstated by RM59.2 million.

(ii) The right-of-use assets as of 31 December 2022 was understated by RM30.9 million as certain capital
expenditures were expensed to the income statement for the period ended 31 December 2022.

(iii) In the previous financial period, the Group did not recognise the estimated obligation of RM46
million under the profit-sharing arrangement entered into with the Group’s creditors in connection
with the debt restructuring scheme which was completed on 16 March 2022.

The above have been adjusted for retrospectively as prior year adjustments.

The prior year adjustments did not have any impact to the balances as at 1 July 2021. Accordingly, the
statements of financial positions of the Group and the Company as of 1 July 2021 are not presented.

The Group and the Company restated the affected financial statement line items for prior period to correct
(i) to (iii) as follows:

Impact on equity (increase in equity)

Group
and
Company
31.12.2022
RM’000

Right-of-use assets (ii) 30,918

Total assets 30,918

Trade and other payables (ii) (18,120)

Provision for profit sharing (iii) (46,000)
Provision for aircraft maintenance (i) 59,176
Total liabilities (4,944)
Net impact on equity (25,974)

212 AirAsia X Berhad

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

45. Prior year adjustments (Cont’d.)

The Group and the Company restated the affected financial statement line items for prior period to correct
(i) to (iii) as follows (Cont’d.):

Impact on profit or loss (increase in profit)

Group
and
Company
1.7.2021
to
31.12.2022
RM’000

Operating expenses
- Depreciation (ii) 666
- Maintenance and overhaul (i) & (ii) (69,676)
Other loss (iii) 46,000
Finance costs (ii) (2,964)
Net impact on loss for the period (25,974)

Attributable:
Owners of the Company (25,974)

Impact on statement of cash flows (increase/(decrease) in cash and cash equivalents)

Group Company
1.7.2021 1.7.2021
to to
31.12.2022 31.12.2022
RM’000 RM’000

Profit before tax 25,974 25,974

Depreciation 666 666
Net gain of discounting effect on financial instruments (2,964) (2,964)
Operating gain before working capital changes 23,676 23,676
Increase in trade and other receivables 95 95
Decrease in trade and other payables (23,771) (23,771)
Net impact on cash and cash equivalents - -

2023 Annual Report 213

NOTES TO THE
FINANCIAL STATEMENTS
31 December 2023

45. Prior year adjustments (Cont’d.)

The Group and the Company restated the affected financial statement line items for prior period to correct
(i) to (iii) as follows (Cont’d.):

Impact on basic and diluted earnings per share (“EPS”) (increase in EPS)

Group
and
Company
1.7.2021
to
31.12.2022
sen

Earnings per share

Basic and diluted, profit for the period attributable to ordinary equity holders of the
parent 6.2

The prior year adjustments did not have any impact to the opening balance of the comparative balances.

214 AirAsia X Berhad

STATEMENT BY
DIRECTORS
Pursuant to Section 251(2) of the Companies Act 2016

We, Dato’ Fam Lee Ee and Dato’ Abdul Mutalib bin Alias, being two of the Directors of AirAsia X Berhad, do
hereby state that, in the opinion of the Directors, the accompanying financial statements set out on pages 123 to
214 are drawn up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting
Standards and the requirements of the Companies Act 2016 in Malaysia, so as to give a true and fair view of the
financial position of the Group and of the Company as at 31 December 2023 and of their financial performance
and cash flows for the financial year then ended.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors dated 30 April 2024.

Dato' Fam Lee Ee Dato' Abdul Mutalib bin Alias

Director Director

Kuala Lumpur, Malaysia

STATUTORY
DECLARATION
Pursuant to Section 251(1)(b) of the Companies Act 2016

I, Lavinia Louis, the officer primarily responsible for the financial management of AirAsia X Berhad, do solemnly
and sincerely declare that the accompanying financial statements set out on pages 123 to 214 are, in my opinion,
correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the
provisions of the Statutory Declarations Act 1960.

Subscribed and solemnly declared

by the abovenamed Lavinia Louis
at Kuala Lumpur in the Federal Territory
on 30 April 2024. Lavinia Louis

Before me,

Commissioner for Oaths

Kuala Lumpur

2023 Annual Report 215

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Report on the audit of the financial statements

Opinion

We have audited the financial statements of AirAsia X Berhad, which comprise the statements of financial
position as at 31 December 2023 of the Group and of the Company, and statements of profit or loss and other
comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the
Company for the financial year then ended, and notes to the financial statements, including material accounting
policy information, as set out on pages 123 to 214.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the
Group and of the Company as at 31 December 2023, and of their financial performance and their cash flows
for the financial year then ended in accordance with the Malaysian Financial Reporting Standards, International
Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.

Basis for opinion

We conducted our audit in accordance with approved standards on auditing in Malaysia and International
Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’
responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence and other ethical responsibilities

We are independent of the Group and of the Company in accordance with the By-Laws (on Professional Ethics,
Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Code of
Ethics for Professional Accountants (including International Independence Standards) (“IESBA Code”), and we
have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial statements of the Group and of the Company for the current year. These matters were addressed in
the context of our audit of the financial statements of the Group and of the Company as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our
description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditors’ responsibilities for the audit of the financial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement of the
financial statements. The results of our audit procedures, including the procedures performed to address the
matters below, provide the basis of our audit opinion on the accompanying financial statements.

216 AirAsia X Berhad

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Key audit matters (Cont’d.)

Key risk Our response

Revenue recognition from scheduled flights and
sales in advance

For the financial year ended 31 December 2023, To address this area of focus, we performed, amongst
revenue from scheduled flights and ancillary services others, the following procedures:
accounted for 93% of the Group’s total revenue.
The Group and the Company rely on an integrated a) Obtained an understanding and assessed the
information technology system (including the flight Group’s information technology systems and key
reservation system and revenue accounting system), controls that affect the recording of revenue from
in accounting for its scheduled flights and ancillary passenger seat sales. As the flight reservation
revenue. Such information system processes large system is managed by a third-party vendor, we
volumes of data comprising individually low value obtained and assessed the external expert’s
transactions. report on the operating effectiveness of the key
controls over the system;
The flight reservation system is managed by third
party vendor. b) Involved our information technology specialists to
test the effectiveness of the automated controls
The accounting for revenue from scheduled flights of the key modules of the information technology
and ancillary services are susceptible to management system;
override through the posting of manual journal entries
either in the underlying ledgers or as a consolidated c) Tested the non-automated controls in place to
journal. ensure the completeness and accuracy of revenue
recognised, including timely updating of approved
The above factors gave rise to higher risk of material changes to base fares and ancillary fares;
misstatement in the timing and amount of revenue
recognised. Accordingly, we identified revenue d) Conducted data analytics to reconcile the revenue
recognition to be an area of focus. recognised in respect of passenger seat sales
and the amount of sales in advance to payments
The notes relating to schedule and ancillary revenue received from passengers;
are disclosed in Notes 2.18 and 4 to the financial
statements. e) Corroborated the occurrence of revenue by tracing
samples of revenue recognised to settlement
reports from financial institutions;

f) Tested the reconciliation of data between the

flight reservation system and the general ledger
to ensure the completeness of revenue; and

g) Performed procedures to verify that revenue from

passenger seat sales is recorded in the appropriate
accounting period.

2023 Annual Report 217

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Key audit matters (Cont’d.)

Key risk Our response

Provision for aircraft maintenance

As of 31 December 2023, AAX was operating 18 To address this area of focus, we performed, amongst
aircrafts under operating lease arrangements others, the following procedures:
with lessors. In respect of these operating lease
arrangements, the Group and the Company are a) Gained an understanding of the management’s
contractually obligated to maintain the aircraft during process for estimating aircraft maintenance
the lease period and to redeliver the aircraft to the costs for aircraft held under lease arrangements,
lessors at the end of the lease term, in certain pre- including understanding the contractual
agreed conditions. obligations of the Group and of the Company
arising from the lease arrangements;
Management made an estimates of the costs for
aircraft maintenance either through obtaining the b) Evaluated the key assumptions adopted by
estimated overhaul cost from third party maintenance management by discussing with the relevant
service providers or relying on the actual incurred fleet maintenance engineers and tested, on a
overhaul cost of similar aircraft component. sample basis, the accuracy of the data on aircraft
utilisation statistics;
The management then makes provision for such costs
over the flight hours, flight cycles or calendar months c) Compared the historical overhaul costs by aircraft
of the aircraft components as used. These aircraft components or quotations by suppliers for the
utilisation and calendar months affect the extent of overhaul costs against the amount of provision
the restoration work that will be required and the made by the Group and by the Company to assess
expected costs of such overhaul, restoration and the adequacy of the provision; and
redelivery at the end of the lease term.
d) Performed recalculation of the aircraft
A provision of RM389.5 million was recorded by maintenance costs provision based on the key
AAX for the year, which represents an increase from assumptions adopted by management.
RM225.8 million as at 31 December 2022.

The provision for aircraft maintenance has been

identified as an area of audit focus due to the
significant amount involved and the high level of
judgment and estimates applied by management in
determining the provision.

The notes relating to provision for aircraft maintenance

are disclosed in Notes 2.10, 3(ii) and 33 to the financial
statements.

218 AirAsia X Berhad

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Key audit matters (Cont’d.)

Key risk Our response

Provision for additional loss in the investment in PT
Indonesia AirAsia Extra

As disclosed in Notes 3(iv) and 42 to the financial In addressing this area of audit focus, we performed
statements, during the previous financial period ended amongst others, the following procedures:
31 December 2022, the Company’s joint venture,
PT Indonesia AirAsia Extra (IAAX), received a Tax a) We assessed the external lawyers’ objectivity and
Underpayment Assessment Letter from the Indonesia independence, and reviewed their credentials,
Tax Office (“ITO”) demanding a payment of RM200.7 qualifications, experience and reputation;
million for tax underpayment in the fiscal year 2017.
During the financial year ended 31 December 2023, b) We discussed with our internal tax specialists
ITO raised additional assessment of RM236.6 million to understand the prevailing tax regulations in
in respect of fiscal year 2018 and 2019. Indonesia and the effects of such regulations
on the shareholders of corporate taxpayers in
IAAX disputed the tax assessments by the ITO and Indonesia;
submitted objection letters and appeal letters to the
ITO. ITO rejected the appeal by IAAX and the case c) We discussed with the external lawyers to
has been brought to court. In the event the dispute understand the basis and judgment applied in
is ruled in favour of the ITO, it is unlikely that IAAX determining the probability of an outflow of
will be able to pay the additional tax. Based on the resources embodying economic benefits, if any,
prevailing tax regulation in Indonesia, tax collection required to settle the obligation; and
actions shall be carried out against “tax bearers” of
corporate taxpayers in the event of nonpayment by d) We evaluated the adequacy of the disclosures of
the corporate taxpayers. Tax bearers are defined under this matter.
the tax regulation in Indonesia to include shareholders
of corporate taxpayers. Consequently, the Company,
as IAAX’s shareholder, may be responsible for the
settlement of IAAX’s tax payable of RM215.9 million,
computed based on the Company’s equity interest in
IAAX.

The Directors of the Company in consultation with

their external lawyer are of the opinion that as at 31
December 2023, it is not probable that an outflow
of resources embodying economic benefits will be
required to settle the obligation for reasons further
disclosed in Note 42. Accordingly, this matter is
disclosed as a contingent liability in Note 42 to the
financial statements as it gives rise to a possible
obligation whose existence will be confirmed only
by the occurrence or non-occurrence of one of more
uncertain future events not wholly within the control
of the Company.

Due to the significance of this matter, we consider this

to be an area of audit focus.

2023 Annual Report 219

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Information other than the financial statements and auditors’ report thereon

The Directors of the Company are responsible for the other information. The other information comprises the
Annual Report but does not include the financial statements of the Group and of the Company and our auditors’
report thereon.

Our opinion on the financial statements of the Group and of the Company does not cover the other information
and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to
read the other information identified above and, in doing so, consider whether the other information is materially
inconsistent with the financial statements of the Group and of the Company or our knowledge obtained in the
audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the financial statements

The Directors of the Company are responsible for the preparation of financial statements of the Group and of the
Company that give a true and fair view in accordance with Malaysian Financial Reporting Standards, International
Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The directors are
also responsible for such internal control as the directors determine is necessary to enable the preparation of
the financial statements of the Group and of the Company that are free from material misstatement, whether
due to fraud or error.

In preparing the financial statements of the Group and of the Company, the Directors are responsible for assessing
the Group’s and the Company’s ability to continue as a going concern, disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate
the Group or the Company or to cease operations, or have no realistic alternative but to do so.

Auditors’ responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the
Company as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on
Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these financial statements.

220 AirAsia X Berhad

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Auditors’ responsibilities for the audit of the financial statements (Cont’d.)

As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards
on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit.
We also:

• Identify and assess the risks of material misstatement of the financial statements of the Group and of the
Company, whether due to fraud or error, design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Group and of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the Directors.

• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the Group’s or the Company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to
the related disclosures in the financial statements of the Group and of the Company or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditors’ report. However, future events or conditions may cause the Group or the Company
to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements of the Group and of
the Company, including the disclosures, and whether the financial statements of the Group and of the
Company represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial statements of the Group. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our
audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.

We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats
or safeguards applied.

From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial statements of the Company for the current period and are therefore the key audit
matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.

2023 Annual Report 221

INDEPENDENT AUDITORS’
REPORT
To the members of AirAsia X Berhad (Incorporated in Malaysia)

Other matters

This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the
Companies Act 2016 and for no other purpose. We do not assume responsibility to any other person for the
content of this report.

Ernst & Young PLT Low Khung Leong

202006000003 (LLP0022760-LCA) & AF 0039 No. 02697/01/2025 J
Chartered Accountants Chartered Accountant

Kuala Lumpur, Malaysia

30 April 2024

222 AirAsia X Berhad

ANALYSIS OF
SHAREHOLDINGS
As at 29 March 2024

DISTRIBUTION OF SHAREHOLDINGS

Class of Shares : Ordinary Shares

Voting Rights : One vote per Ordinary Share

Shareholdings No. of Holders % No. of Shares %

1 - 99 3,964 10.373 128,768 0.028
100 - 1,000 17,113 44.784 8,531,832 1.908
1,001 - 10,000 13,667 35.766 51,324,129 11.480
10,001 - 100,000 3,178 8.316 88,994,006 19.905
100,001 - 22,353,639 (*) 288 0.753 188,870,907 42.246
22,353,640 AND ABOVE (**) 2 0.005 109,223,161 24.430
38,212 100.000 447,072,803 100.000

* - Less than 5% of issued shares

** - 5% And above of issued shares

SUBSTANTIAL SHAREHOLDERS

Names Holdings %
AIRASIA BERHAD 57,072,850 12.765
RHB CAPITAL NOMINEES (TEMPATAN) SDN BHD 52,150,311 11.664
RHB ISLAMIC BANK BERHAD PLEDGED SECURITIES ACCOUNT
FOR TUNE GROUP SDN BHD

2023 Annual Report 223

DIRECTORS’
SHAREHOLDINGS
As at 29 March 2024

Direct Indirect
Name No. of % of No. of % of
Shares Held Shares Held Shares Held Shares Held
Dato’ Fam Lee Ee - - - -
Datuk Kamarudin bin Meranun 37,070,993 8.292 131,033,136 (1)
29.309
Tan Sri Asmat bin Kamaludin 10,000 0.002 2,000 (2)
0.000*
Chin Min Ming - - - -
Dato’ Sri Mohammed Shazalli bin Ramly - - - -
Dato’ Abdul Mutalib bin Alias - - - -

Notes:
* Negligible
(1)
Deemed interested by virtue of Section 8 of the Companies Act 2016 through a shareholding of more than
20% in Tune Group Sdn Bhd and AirAsia Berhad.
(2)
Deemed interest held through his children.

224 AirAsia X Berhad

TOP 30 LARGEST
SHAREHOLDERS
As at 29 March 2024

No Name of Shareholders No. of % of Issued

Shares Held Share Capital
1. AIRASIA BERHAD 57,072,850 12.765
2. RHB CAPITAL NOMINEES (TEMPATAN) SDN BHD 52,150,311 11.664
RHB ISLAMIC BANK BERHAD PLEDGED SECURITIES ACCOUNT
FOR TUNE GROUP SDN BHD
3. ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD 21,809,975 4.878
PLEDGED SECURITIES ACCOUNT FOR TUNE GROUP SDN BHD
(7006233)
4. HSBC NOMINEES (TEMPATAN) SDN BHD 19,027,895 4.256
PLEDGED SECURITIES ACCOUNT - CREDIT SUISSE AG,
SINGAPORE FOR KAMARUDIN BIN MERANUN
5. KAMARUDIN BIN MERANUN 18,043,098 4.035
6. CITIGROUP NOMINEES (ASING) SDN BHD 12,000,000 2.684
EXEMPT AN FOR CITIBANK NEW YORK (NORGES BANK 22)
7, ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD 11,130,372 2.489
PLEDGED SECURITIES ACCOUNT FOR ANTHONY FRANCIS
FERNANDES (7006493)
8. LAVIN GROUP SDN BHD 8,922,133 1.995
9. HSBC NOMINEES (ASING) SDN BHD 7,844,263 1.754
EXEMPT AN FOR BANK JULIUS BAER & CO. LTD.
(SINGAPORE BCH)
10. KENANGA NOMINEES (ASING) SDN BHD 5,000,000 1.118
GARYNMA MY CAPITAL LIMITED
111. CITIGROUP NOMINEES (ASING) SDN BHD 4,622,300 1.033
EXEMPT AN FOR CITIBANK NEW YORK (NORGES BANK 14)
12. CITIGROUP NOMINEES (ASING) SDN BHD 2,950,000 0.659
EXEMPT AN FOR UBS AG SINGAPORE (FOREIGN)
13. CGS INTERNATIONAL NOMINEES MALAYSIA (TEMPATAN) 2,200,000 0.492
SDN BHD
PLEDGED SECURITIES ACCOUNT FOR TANG VEE MUN
(DATUK) (MY4553)
14. PUBLIC NOMINEES (TEMPATAN) SDN BHD 1,823,000 0.407
PLEDGED SECURITIES ACCOUNT FOR TAN KEOK CHAI
(E-TSA)
15. CGS INTERNATIONAL NOMINEES MALAYSIA (TEMPATAN) 1,738,200 0.388
SDN BHD
PLEDGED SECURITIES ACCOUNT FOR CHIEW CHIENG SIEW
(MK0111)

2023 Annual Report 225

TOP 30 LARGEST
SHAREHOLDERS

No Name of Shareholders No. of % of Issued

Shares Held Share Capital
16. WONG WENG TIEN 1,365,800 0.305
17. CITIGROUP NOMINEES (TEMPATAN) SDN BHD 1,250,000 0.279
KUMPULAN WANG PERSARAAN (DIPERBADANKAN)
(MYBK AM SC E)
18. MAYBANK NOMINEES (TEMPATAN) SDN BHD 1,185,000 0.265
PLEDGED SECURITIES ACCOUNT FOR MOHAMAD NORZA BIN
ZAKARIA
19. PUBLIC NOMINEES (TEMPATAN) SDN BHD 1,054,700 0.235
PLEDGED SECURITIES ACCOUNT FOR WONG TING TECK
(E-JCL)
20. TEO TUAN KWEE 1,003,000 0.224
21. CARTABAN NOMINEES (TEMPATAN) SDN BHD 1,002,900 0.224
PAMB FOR PRULINK EQUITY FUND
22. SENG SIAW WEI 1,000,000 0.223
23. CIMSEC NOMINEES (TEMPATAN) SDN BHD 941,000 0.210
CIMB FOR AUGUSTUS RALPH MARSHALL (PB)
24. UNIVERSAL TRUSTEE (MALAYSIA) BERHAD 909,600 0.203
TA DANA FOKUS
25. PUBLIC NOMINEES (TEMPATAN) SDN BHD 860,000 0.192
PLEDGED SECURITIES ACCOUNT FOR CHIEW CHIENG SIEW
(E-PDG)
26. LOW SU-MING 841,000 0.188
27. THEN MEE KOM 790,000 0.176
28. AMCEN CONSULTANCY SDN BHD 752,900 0.168
29. CARTABAN NOMINEES (ASING) SDN BHD 739,300 0.165
EXEMPT AN FOR BARCLAYS CAPITAL SECURITIES LTD
(SBL/PB)
30. ZAKARIA BIN MERANUN 692,200 0.154

226 AirAsia X Berhad

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN THAT the Seventeenth (“17th”) Annual General Meeting (“AGM”) of AirAsia X Berhad
(Registration No. 200601014410) (734161-K) (the “Company”) will be held as a virtual meeting through live
streaming and online remote voting from the Broadcast Venue at RedQ, Jalan Pekeliling 5, Lapangan Terbang
Antarabangsa Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia on Thursday, 6 June 2024 at 2.00 p.m.
for the following purposes:-

AS ORDINARY BUSINESS

1. To receive the Audited Financial Statements together with the Reports of the
Directors and Auditors thereon for the financial period ended 31 December 2023.

Please refer to Note A.

2. To approve the Non-Executive Directors’ Remuneration as described in Note B for (Ordinary Resolution 1)
the period from the 17th AGM until the next AGM of the Company to be held in the
year 2025.

Please refer to Note B.

3. To re-elect the following Directors of the Company who retire by rotation pursuant
to Rule 119 of the Company’s Constitution and who being eligible had offered
themselves for re-election:-
i) Tan Sri Asmat bin Kamaludin; and (Ordinary Resolution 2)
ii) Ms Chin Min Ming. (Ordinary Resolution 3)
4. To re-elect the following Directors of the Company who retire pursuant to Rule 124
of the Company’s Constitution and who being eligible had offered themselves for
re-election:-
i) Dato’ Abdul Mutalib bin Alias; and (Ordinary Resolution 4)
ii) Dato’ Sri Mohammed Shazalli bin Ramly. (Ordinary Resolution 5)
5. To re-appoint Messrs Ernst & Young as Auditors of the Company and to authorise (Ordinary Resolution 6)
the Directors to determine their remuneration.

2023 Annual Report 227

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

AS SPECIAL BUSINESS

To consider and if thought fit, to pass the following resolutions:-

6. AUTHORITY TO ALLOT SHARES PURSUANT TO SECTIONS 75 AND 76 OF THE (Ordinary Resolution 7)

COMPANIES ACT 2016 (“ACT”) AND WAIVER OF PRE-EMPTIVE RIGHTS

“THAT pursuant to Sections 75 and 76 of the Companies Act, 2016 (“the Act”) and
subject always to the approval of all the relevant regulatory authorities, the Board of
Directors of the Company be and is hereby authorised to issue and allot from time
to time such number of shares of the Company upon such terms and conditions
and for such purposes as the Directors may, in their absolute discretion, deem fit,
PROVIDED ALWAYS THAT the aggregate number of shares to be issued does not
exceed 10% of the total number of issued shares of the Company for the time being.

THAT pursuant to Section 85 of the Act read together with Clause 16 of the Company’s
Constitution, approval be and is hereby given to waive the statutory pre-emptive rights
of the shareholders of the Company to be offered new shares ranking equally to the
existing issued shares arising from any issuance of new shares pursuant to the mandate.”

AND THAT the Directors are also empowered to obtain the approval from Bursa
Malaysia Securities Berhad (“Bursa Securities”) for the listing of and quotation for the
additional shares so issued and that such authority shall continue to be in force until
the conclusion of the next AGM of the Company or the expiration of the period within
which the next AGM is required by law to be held or revoked/varied by resolution
passed by the shareholders in general meeting whichever is the earlier”.

Please refer to Note C.

7. PROPOSED RENEWAL OF EXISTING SHAREHOLDERS’ MANDATE FOR RECURRENT (Ordinary Resolution 8)
RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE AND PROPOSED
NEW SHAREHOLDERS’ MANDATE FOR THE NEW RECURRENT RELATED PARTY
TRANSACTIONS OF A REVENUE OR TRADING NATURE (“PROPOSED MANDATE”)

“THAT approval be and is hereby given for the renewal of the existing shareholders’
mandate and new shareholders’ mandate for the Company to enter into recurrent related
party transactions of a revenue or trading nature with the related parties (“Recurrent
Related Party Transactions”) as set out in Section 2.3 of the Circular to Shareholders dated
30 April 2024 (“Circular”), subject further to the following:-

i) the Recurrent Related Party Transactions are entered into in the ordinary course
of business which are:
(a) necessary for the day-to-day operations;
(b) on normal commercial terms and transaction price which are not more
favourable to the related parties than those generally available to the public;
(c) undertaken on arm’s length basis; and
(d) not to the detriment of the minority shareholders of the Company;

ii) the shareholders’ mandate is subject to annual renewal and this shareholders’
mandate shall only continue to be in full force until:
(a) the conclusion of the next AGM of the Company at which time it will lapse,
unless by an ordinary resolution passed at that AGM, such authority is renewed;
(b) the expiration of the period within which the next AGM after the date is required
to be held pursuant to Section 340(2) of the Act (but shall not extend to such
extension as may be allowed pursuant to Section 340(4) of the Act; or
(c) revoked or varied by ordinary resolution passed by the shareholders of the
Company in a general meeting of the Company, whichever is the earliest.

228 AirAsia X Berhad

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

THAT the Directors of the Company and/or any one (1) of them be and are hereby
authorised to complete and do all such acts and things and take all such steps
and to execute all such transactions, deeds, agreements, arrangements and/or
undertakings as the Directors in their discretion deem fit, necessary, expedient and/
or appropriate in the best interest of the Company in order to implement, finalise
and give full effect to the Recurrent Related Party Transactions with full powers to
assent to any modifications, variations and/or amendments thereto.

AND THAT as the estimates given for the Recurrent Related Party Transactions
specified in Section 2.3 of the Circular being provisional in nature, the Directors of
the Company and/or any one (1) of them be and are hereby authorised to agree to
the actual amount or amounts thereof provided always that such amount or amounts
comply with the procedures set out in Section 2.6 of the Circular.”

Please refer to Note D.

8. RETENTION OF INDEPENDENT DIRECTOR (Ordinary Resolution 9)

“THAT Tan Sri Asmat bin Kamaludin, the Director who has served the Board as an
Independent Non-Executive Chairman of the Company for a cumulative term of
more than nine (9) years, but less than twelve (12) years, be and is hereby retained
as Independent Non-Executive Director of the Company.”

OTHER ORDINARY BUSINESS

9. To transact any other business of which due notice shall have been given in accordance
with the Companies Act 2016 and the Constitution of the Company.

By Order of the Board

THIN PUI LENG (LS0009933)

(SSM PC No. 202208000271)

Company Secretary
Selangor Darul Ehsan
30 April 2024

VIRTUAL AGM

1. The 17th AGM will be held as a virtual meeting through live streaming and online remote voting using the
Remote Participation and Voting Facilities (“RPV”) provided by Tricor Investor & Issuing House Services
Sdn Bhd (“TIIH”) via its TIIH Online website at https://tiih.online. This is in line with the revised Guidance
Note on the Conduct of General Meetings for Listed Issuers issued by the Securities Commission Malaysia
on 7 April 2022 (including any amendments that may be made from time to time) (“Guidance Note”).
Please follow the procedures as set out in the Administrative Details which is available at the Company’s
website at www.airasiax.com.

2. The Broadcast Venue is strictly for the purpose of complying with Section 327(2) of the Companies Act 2016
and Guidance Note which require the Chairman of the meeting to be present at the main venue of the meeting.

3. Members and/or proxy(ies) and/or corporate representative(s) and/or attorneys WILL NOT BE ALLOWED
to be physically present at the Broadcast Venue on the day of the 17th AGM, instead are to attend, speak
(including posing questions to the Board of Directors via real time submission of typed texts) and vote
(collectively, “participate”) remotely at the 17th AGM via the RPV provided by TIIH.

2023 Annual Report 229

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

NOTES ON APPOINTMENT OF PROXY

1. Pursuant to the Securities Industry (Central Depositories) (Foreign Ownership) Regulations 1996 and Rule 41(a)
of the Company’s Constitution, only those Foreigners (as defined in the Constitution) who hold shares up to the
current prescribed foreign ownership limit of 45.0% of the total number of issued shares of the Company, on a
first-in-time basis based on the Record of Depositors to be used for the forthcoming AGM, shall be entitled to
vote. A proxy appointed by a Foreigner not entitled to vote, will similarly not be entitled to vote. Consequently,
all such disenfranchised voting rights shall be automatically vested in the Chairman of the AGM.

2. A member must be registered in the Record of Depositors at 5.00 p.m. on 28 May 2024 (“General Meeting
Record of Depositors”) in order to attend and vote at the Meeting. A depositor shall not be regarded as a
member entitled to attend the Meeting and to speak and vote thereat unless his name appears in the General
Meeting Record of Depositors. Any changes in the entries on the Record of Depositors after the abovementioned
date and time shall be disregarded in determining the rights of any person to attend and vote at the Meeting.

3. A member entitled to attend and vote is entitled to appoint not more than two (2) proxies (or in the case of
a corporation, to appoint a representative(s) in accordance with Section 333 of the Companies Act, 2016) to
attend and vote in his stead. There shall be no restriction as to the qualification of the proxy(ies).

4. Where a member appoints two (2) proxies, the appointment shall be invalid unless he specifies the proportion
of his shareholdings to be represented by each proxy.

5. Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company
for multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number
of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

6. The appointment of a proxy may be made in a hard copy form or by electronic means in the following manner
and must be received by the Company not less than forty-eight (48) hours before the time appointed for holding
the 17th AGM or adjourned general meeting at which the person named in the appointment proposes to vote:

(i) In hard copy form

In the case of an appointment made in hard copy form, this Form of Proxy must be deposited at the
Registered Office of the Company at RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa Kuala
Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia.

(ii) By electronic means

This Form of Proxy can be electronically lodged via TIIH Online website at https://tiih.online. Kindly refer
to the Administrative Details on the procedures for electronic lodgement of form of proxy via TIIH Online.

7. Please ensure ALL the particulars as required in this Form of Proxy are completed, signed and dated accordingly.

8. Last date and time for lodging this Form of Proxy is Tuesday, 4 June 2024 at 2.00 p.m.

9. Any authority pursuant to which such an appointment is made by a power of attorney must be deposited
at the Registered Office of the Company at RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa
Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia not less than forty-eight (48) hours before the
time appointed for holding the 17th AGM or adjourned general meeting at which the person named in the
appointment proposes to vote. A copy of the power of attorney may be accepted provided that it is certified
notarially and/or in accordance with the applicable legal requirements in the relevant jurisdiction in which it
is executed.

230 AirAsia X Berhad

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

10. For a corporate member who has appointed an authorised representative, please deposit the ORIGINAL/DULY
CERTIFIED certificate of appointment of authorised representative at the Registered Office of the Company at
RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan,
Malaysia. The certificate of appointment of authorised representative should be executed in the following manner:

(i) If the corporate member has a common seal, the certificate of appointment of authorised representative
should be executed under seal in accordance with the constitution of the corporate member.

(ii) If the corporate member does not have a common seal, the certificate of appointment of authorised
representative should be affixed with the rubber stamp of the corporate member (if any) and executed by:
(a) at least two (2) authorised officers, of whom one shall be a director; or
(b) any director and/or authorised officers in accordance with the laws of the country under which the
corporate member is incorporated.

11. Pursuant to Paragraph 8.29A(1) of the Main Market Listing Requirements of Bursa Securities, all resolutions
set out in this Notice of the 17th AGM will be put to vote by way of poll.

EXPLANATORY NOTES:

A. Audited Financial Statements together with the Reports of the Directors and Auditors thereon for the
financial period ended 31 December 2023

This Agenda item is meant for discussion only in accordance with Sections 248(2) and 340(1) of the Companies
Act 2016 (“the Act”). The audited financial statements do not require the formal approval of shareholders
and therefore, the matter will not be put forward for voting.

B. To approve the Non-Executive Directors’ Remuneration for the period from the 17th AGM until the next
AGM of the Company to be held in the year 2025 (Ordinary Resolution 1)

The Nomination and Remuneration Committee has recommended and the Board of Directors affirmed that the
Non-Executive Directors’ Remuneration for the period from the 17th AGM until the next AGM of the Company to be
held in the year 2025 shall remain unchanged as per the financial year ended 31 December 2023, as shown below:-

Non-Executive Directors’ Fees Non-Executive Non-Executive Per Non-Executive

(per annum) Chairman Deputy Chairman Director/Per
(RM) (RM) other Committee
Member
(RM)
Board of Directors 165,000 115,000 65,000
Audit Committee 40,000 - 30,000
Nomination and Remuneration Committee 30,000 - 20,000
Safety Review Board 30,000 - 20,000
Risk Management Committee 30,000 - 20,000

Non-Executive Directors’ Benefits Board of Directors Board Committees

(per attendance by each Director or
committee member)
Meeting allowance 1,000 1,000
Other Non-Executive Directors’ Benefits
Insurance premiums on medical coverage, Up to a total amount of RM100,000 for all Non-Executive
and other claimable expenses incurred Directors.
in the course of carrying out their duties

2023 Annual Report 231

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

The shareholders’ approval being sought under Ordinary Resolution 1 is for the payment of the remuneration
to Non-Executive Directors for the period from the 17th AGM up to the next AGM of the Company in accordance
with the remuneration structure as set out above and to authorise the Directors to disburse the fees on a
monthly basis.

C. Authority to allot shares pursuant to Sections 75 and 76 of the Act and Waiver of Pre-emptive Rights
(Ordinary Resolution 7)

The Company had at its Sixteenth AGM held on 8 June 2023 (“16th AGM”), obtained a general mandate
pursuant to Sections 75 and 76 of the Act from its shareholders, to empower the Directors to allot and issue
shares in the Company from time to time and upon such terms and conditions and for such purposes and
to such persons whomsoever as the Directors may, in their absolute discretion, deem fit provided that the
aggregate number of shares issued does not exceed 10% of the total number of issued shares (excluding
treasury shares) of the Company at any point of time (“10% General Mandate”). The 10% General Mandate
would expire at the conclusion of the forthcoming AGM.

Ordinary Resolution 7 has been proposed for the purpose of renewing the general mandate for issuance
of shares by the Company pursuant to Sections 75 and 76 of the Act read together with Article 17 of the
Company’s Constitution.

Ordinary Resolution 7, if passed, will empower the Directors of the Company authority to issue ordinary
shares in the Company at their discretion without having to first convene another general meeting provided
that the aggregate number of the shares issued does not exceed 10% of the total number of issued shares
of the Company at any point of time. The 10% mandate, if granted at this AGM, unless revoked or varied by
the Company in a general meeting, would expire upon the conclusion of the next AGM.

The 10% mandate, if granted, will provide the flexibility to the Company for any future fund raising activities,
including but not limited to further placing of shares for the purposes of funding future investment project(s),
repayment of bank borrowing(s), working capital and/or acquisition(s) and thereby reducing administrative
time and costs associated with the convening of additional shareholders meeting(s).

D. Proposed Renewal of Existing Shareholders’ Mandate and New Shareholders’ Mandate for Recurrent Related
Party Transactions of a Revenue or Trading Nature (“Proposed Mandate”) (Ordinary Resolution 8)

Ordinary Resolution 8, if passed, will allow the Company to enter into Recurrent Related Party Transactions
of a revenue or trading nature pursuant to the provisions of the Main Market Listing Requirements of Bursa
Securities. Please refer to the Circular to Shareholders dated 30 April 2024 for further information.

E. Retention of Independent Non-Executive Director (Ordinary Resolution 9)

This item is tabled pursuant to Practice 5.3 of the Malaysian Code on Corporate Governance. The Nomination
and Remuneration Committee and the Board of Directors had assessed the independence of Tan Sri Asmat
bin Kamaludin, who has served as an Independent Non-Executive Director of the Company since 13 May 2013
for a cumulative term of more than nine (9) years, but less than twelve (12) years, and with his consent, had
recommended for him to continuing serving as an Independent Non-Executive Director of the Company.

The Board holds the view that a Director’s independence cannot be determined arbitrarily with reference
to a set period of time. The Company benefits from the long service of Tan Sri Asmat bin Kamaludin who
possesses an incumbent knowledge of the Company and the Group’s activities and corporate history and has
provided invaluable contributions to the Board in his role as an Independent Non-Executive Director. In fact,
he has been bringing his independent and objective judgment to the deliberations and the decision-making
process of the Board. In addition, he has exercised due care during his tenure as an Independent Director, as
well as the Chairman of the Nomination and Remuneration Committee and a member of the Audit Committee
of the Company. As an Independent Non-Executive Director, he has carried out his duties proficiently in the
interest of the Company and the shareholders.

232 AirAsia X Berhad

NOTICE OF THE 17TH
ANNUAL GENERAL MEETING

PERSONAL DATA PRIVACY By submitting an instrument appointing a proxy(ies) and/or representative(s) to

attend, speak and vote at the Annual General Meeting (“AGM”) and/or any adjournment thereof, a member of the
Company (i) consents to the collection, use and disclosure of the member’s personal data by the Company (or
its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and
representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation
of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof),
and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/
or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses the personal data of
the member’s proxy(ies) and/or representative(s) to the Company (or its agents), the member has obtained the
prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company
(or its agents) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees
and undertakes that the member shall indemnify the Company and/or to keep the Company fully indemnified
and save the Company harmless against all and/or any actions, demands, claims, losses, costs, proceedings and
damages (including all legal fees and costs) which the Company may suffer or incur in any manner howsoever
arising from or as a result of the member’s breach of the aforementioned warranty.

2023 Annual Report 233

This page intentionally left blank
AIRASIA X BERHAD
(Registration No.: 200601014410) (734161-K)
(“the Company”)
Incorporated in Malaysia

FORM OF PROXY

I/We NRIC No./Passport No./Company No.:

(FULL NAME AS PER NRIC/CERTIFICATE OF INCORPORATION IN BLOCK LETTERS) (COMPULSORY)

of
(FULL ADDRESS)

telephone no. , email address , being a member of the

Company, hereby appoint

(FULL NAME IN BLOCK LETTERS)

NRIC No./Passport No.: of

(COMPULSORY) (FULL ADDRESS)

telephone no. , email address

or failing him/her, NRIC No./Passport No.:

(FULL NAME IN BLOCK LETTERS) (COMPULSORY)

of
(FULL ADDRESS)

telephone no. , email address

*or failing him/her, the Chairman of the Meeting, as my/our proxy(ies) to vote in my/our name and on my/our
behalf at the Seventeenth (“17th”) Annual General Meeting (“AGM”) of the Company to be conducted as a virtual
meeting through live streaming and online remote voting at the Broadcast Venue at RedQ, Jalan Pekeliling
5, Lapangan Terbang Antarabangsa Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia on Thursday,
6 June 2024 at 2.00 p.m. and at any adjournment thereof, on the following resolutions referred to in the Notice
of the 17th AGM, and to vote as indicated below:

AGENDA

RESOLUTIONS Description FOR AGAINST

ORDINARY BUSINESS
Ordinary To approve the Non-Executive Directors’ Remuneration for the period from
Resolution 1 the 17th AGM until the next AGM of the Company to be held in the year 2025
Ordinary Re-election of Tan Sri Asmat bin Kamaludin as a Director of the Company,
Resolution 2 who retires by rotation pursuant to Rule 119 of the Company’s Constitution
Ordinary Re-election of Ms Chin Min Ming as a Director of the Company, who retires
Resolution 3 by rotation pursuant to Rule 119 of the Company’s Constitution
Ordinary Re-election of Dato’ Abdul Mutalib bin Alias as a Director of the Company,
Resolution 4 who retires by rotation pursuant to Rule 124 of the Company’s Constitution
Ordinary Re-election of Dato’ Sri Mohammed Shazalli bin Ramly as a Director of the
Resolution 5 Company, who retires by rotation pursuant to Rule 124 of the Company’s
Constitution
Ordinary To re-appoint Messrs Ernst & Young as Auditors of the Company and to
Resolution 6 authorise the Directors to determine their remuneration
SPECIAL BUSINESS
Ordinary Authority to allot shares pursuant to Sections 75 and 76 of the Companies
Resolution 7 Act 2016
Ordinary Proposed renewal of existing shareholders’ mandate and new shareholders’
Resolution 8 mandate for Recurrent Related Party Transactions of a revenue or trading
nature
Ordinary Retention of Tan Sri Asmat bin Kamaludin as an Independent Non-Executive
Resolution 9 Director of the Company

(Please indicate with an “X” in the appropriate spaces how you wish your votes to be cast. If you do not do so,
the proxy will vote or abstain from voting, as he/she thinks fit.)

*Delete the words “or failing him/her, the Chairman of the Meeting” if not applicable.
No. of Shares Held:
CDS Account No.:
(Nominee Account Only)
The proportion of No. of Percentage
my/our holding to be Shares
represented by my/our
First Proxy
proxies are as follows:
Second
Proxy
Date:
Signature(s)/Common Seal of Member(s)

VIRTUAL AGM

1. The 17th AGM will be held as a virtual meeting through live streaming and online remote voting using the Remote Participation and Voting Facilities
(“RPV”) provided by Tricor Investor & Issuing House Services Sdn Bhd (“TIIH”) via its TIIH Online website at https://tiih.online. This is in line with the
revised Guidance Note on the Conduct of General Meetings for Listed Issuers issued by the Securities Commission Malaysia on 7 April 2022 (including
any amendments that may be made from time to time) (“Guidance Note”). Please follow the procedures as set out in the Administrative Details which
is available at the Company’s website at www.airasiax.com.

2. The Broadcast Venue is strictly for the purpose of complying with Section 327(2) of the Companies Act 2016 and Guidance Note which require the
Chairman of the meeting to be present at the main venue of the meeting.

3. Members and/or proxy(ies) and/or corporate representative(s) and/or attorneys WILL NOT BE ALLOWED to be physically present at the Broadcast
Venue on the day of the 17th AGM, instead are to attend, speak (including posing questions to the Board of Directors via real time submission of typed
texts) and vote (collectively, “participate”) remotely at the 17th AGM via the RPV provided by TIIH.

Notes to Form of Proxy

1. Pursuant to the Securities Industry (Central Depositories) (Foreign (ii) By electronic means
Ownership) Regulations 1996 and Rule 41(a) of the Company’s This Form of Proxy can be electronically lodged via TIIH Online
Constitution, only those Foreigners (as defined in the Constitution) who website at https://tiih.online. Kindly refer to the Administrative
hold shares up to the current prescribed foreign ownership limit of 45.0% Details on the procedures for electronic lodgement of form of
of the total number of issued shares of the Company, on a first-in-time proxy via TIIH Online.
basis based on the Record of Depositors to be used for the forthcoming 7. Please ensure ALL the particulars as required in this Form of Proxy are
AGM, shall be entitled to vote. A proxy appointed by a Foreigner not completed, signed and dated accordingly.
entitled to vote, will similarly not be entitled to vote. Consequently, all 8. Last date and time for lodging this Form of Proxy is Tuesday, 4 June
such disenfranchised voting rights shall be automatically vested in the 2024 at 2.00 p.m.
Chairman of the AGM. 9. Any authority pursuant to which such an appointment is made by a
2. A member must be registered in the Record of Depositors at 5.00 p.m. power of attorney must be deposited at the Registered Office of the
on 28 May 2024 (“General Meeting Record of Depositors”) in order Company at RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa
to attend and vote at the Meeting. A depositor shall not be regarded Kuala Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia not less than
as a member entitled to attend the Meeting and to speak and vote forty-eight (48) hours before the time appointed for holding the 17th
thereat unless his name appears in the General Meeting Record of AGM or adjourned general meeting at which the person named in the
Depositors. Any changes in the entries on the Record of Depositors after appointment proposes to vote. A copy of the power of attorney may be
the abovementioned date and time shall be disregarded in determining accepted provided that it is certified notarially and/or in accordance with
the rights of any person to attend and vote at the Meeting. the applicable legal requirements in the relevant jurisdiction in which it
3. A member entitled to attend and vote is entitled to appoint not more is executed.
than two (2) proxies (or in the case of a corporation, to appoint a 10. For a corporate member who has appointed an authorised representative,
representative(s) in accordance with Section 333 of the Companies Act please deposit the ORIGINAL/DULY CERTIFIED certificate of appointment
2016) to attend and vote in his stead. There shall be no restriction as to of authorised representative at the Registered Office of the Company
the qualification of the proxy(ies). at RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa Kuala
4. Where a member appoints two (2) proxies, the appointment shall be Lumpur , 64000 KLIA, Selangor Darul Ehsan, Malaysia. The certificate
invalid unless he specifies the proportion of his shareholdings to be of appointment of authorised representative should be executed in the
represented by each proxy. following manner:
5. Where a member of the Company is an exempt authorised nominee (i) If the corporate member has a common seal, the certificate of
which holds ordinary shares in the Company for multiple beneficial appointment of authorised representative should be executed under
owners in one securities account (“omnibus account”), there is no limit seal in accordance with the constitution of the corporate member.
to the number of proxies which the exempt authorised nominee may (ii) If the corporate member does not have a common seal, the certificate
appoint in respect of each omnibus account it holds. of appointment of authorised representative should be affixed with
6. The appointment of a proxy may be made in a hard copy form or by the rubber stamp of the corporate member (if any) and executed by:
electronic means in the following manner and must be received by the (a) at least two (2) authorised officers, of whom one shall be a
Company not less than forty-eight (48) hours before the time appointed director; or
for holding the 17th AGM or adjourned general meeting at which the (b) any director and/or authorised officers in accordance with
person named in the appointment proposes to vote: the laws of the country under which the corporate member is
(i) In hard copy form incorporated.
In the case of an appointment made in hard copy form, this Form of 11. Pursuant to Paragraph 8.29A(1) of the Main Market Listing Requirements
Proxy must be deposited at the Registered Office of the Company of Bursa Securities, all resolutions set out in this Notice of the 17th AGM
at RedQ, Jalan Pekeliling 5, Lapangan Terbang Antarabangsa Kuala will be put to vote by way of poll.
Lumpur, 64000 KLIA, Selangor Darul Ehsan, Malaysia.

PERSONAL DATA PRIVACY By submitting an instrument appointing a proxy(ies) and/or representative(s), the member accepts and agrees to the personal
data privacy terms set out in the Notice of AGM dated 30 April 2024.
Please fold here

Please fold here

STAMP

The Company Secretary

AIRASIA X BERHAD
(Registration No. 200601014410) (734161-K)

RedQ, Jalan Pekeliling 5

Lapangan Terbang Antarabangsa Kuala Lumpur
64000 KLIA
Selangor Darul Ehsan
Malaysia

Please fold here

www.airasiax.com

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Air Asia Annual Report

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Air Asia Annual Report

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WELCOME

As of 31 December 2023, we maintain a core fleet of 18

Over the past year, we continued to witness the rapid

This report cover visual encapsulates the

to excellence remains steadfast as we continue

to serve our valued passengers with the highest

2023 Annual Report 03

DATO’ FAM LEE EE

DATUK KAMARUDIN TAN SRI ASMAT

He received the Darjah Panglima Jasa Negara (“PJN”),

Datuk Kamarudin is the Non-Independent Executive

2023 Annual Report 05

MS CHIN MIN MING DATO’ ABDUL MUTALIB

DATO’ SRI MOHAMMED

Dato’ Sri Mohammed Shazalli (Male), Malaysian, aged

Dato’ Sri Mohammed Shazalli also brings extensive

Dato’ Sri Mohammed Shazalli was the Group Managing

Dato’ Sri Mohammed Shazalli had also served as

2023 Annual Report 07

Date of Appointment: 1 September 2015 Date of Appointment: 1 October 2023

Age Gender Nationality Age Gender Nationality

Date of Appointment: 1 October 2013 Date of Appointment: 1 October 2013

Age Gender Nationality Age Gender Nationality

2023 Annual Report 09

LIM KOK HOOI

Date of Appointment: 22 January 2018 Date of Appointment: 1 July 2016

Age Gender Nationality Age Gender Nationality

Qualifications and Professional Membership:

Date of Appointment: 5 July 2021 Date of Appointment: 1 April 2022

Age Gender Nationality Age Gender Nationality

Qualifications and Professional Membership: Qualifications and Professional Membership:

Declaration of Leadership Team:

• Conviction for Offences

2023 Annual Report 11

2023 Annual Report 13

I extend my heartfelt gratitude to As we navigate this journey

Looking ahead, in the face of the

2023 Annual Report 15

2023 Annual Report 17

Overview of Group’s Business and Operations

Review of Financial Results and Financial Condition

Group Financial Position

Capital Structure and Capital Resources

Review of Operating Activities

Segmental Performance Review

2023 Annual Report 19

EBITDA/LBITDA FYE 2023 FPE 2022

Profit Before Tax/Loss Before Tax FYE 2023 FPE 2022

Review of Corporate Exercises

Appreciation and Acknowledgements

2023 Annual Report 21

ABOUT THIS STATEMENT

REPORTING FRAMEWORK AND GUIDELINES

•  ask Force on Climate-related Financial Disclosures (“TCFD”)

REPORTING SCOPE AND BOUNDARIES

2023 Annual Report 23

Subject Matter Common Indicators 2023 Data

An overview of AirAsia X’s operational statistics as of 31 December 2023:

In alignment to United Nations Sustainable Development Goals (“SDG”)

SUSTAINABILITY ACHIEVEMENTS & HIGHLIGHTS IN 2023

EES Pillars Indicators 2023

2023 Annual Report 25

Risk Management Committee

Sustainability Steering Committee

Sustainability Working Group

Sustainability Working Group

KEY RISKS, STRATEGIES & OUTLOOK

Pillars Material Topics Risks Strategies & Outlook

Customer Inability to meet customer Ongoing enhancements are implemented

Read more in Chapter 4: Delivering Economic

2023 Annual Report 27

Pillars Material Topics Risks Strategies & Outlook

Waste Non-compliance t o By leveraging pre-booked meal information

Read more in Chapter 2: Addressing Climate Change

COMMITMENT TO THE UN SUSTAINABLE DEVELOPMENT GOALS

SDG SDG Targets Our 2023 Progress

• ask Force on Climate-related Financial Disclosures (“TCFD”)

8.8 Protect labour rights & promote safe and

9.4 Upgrade infrastructure & retrofit to

16.7 Ensure responsive, inclusive, participatory

For more information on Greenhouse Gases Equivalencies, please visit

For more information on the Airbus A330neo aircraft, please visit