AirAsia’s future in ‘significant doubt,’ Ernst & Young warns

AirAsia Group Bhd.’s ability to continue as a going concern may be in “significant doubt” because of the impact the coronavirus is having on the indebted carrier, auditor Ernst & Young said.

The airline’s current liabilities already exceeded its current assets by 1.84 billion ringgit ($430 million) at the end of 2019, a year when it posted a 283 million ringgit net loss, Ernst & Young said in a statement to the Kuala Lumpur stock exchange Wednesday. The financial performance and cash flow have now been further hit by virus-related travel restrictions.

The slump in air travel and the carrier’s financial performance “indicate existence of material uncertainties that may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern,” Ernst & Young said in its unqualified audit opinion statement.