Shares in AirAsia rose nearly 10 percent on Wednesday, their biggest one-day jump since March 2012, after the company said it will pay a dividend from this year, its first official dividend policy since listing in 2004.
Late on Tuesday the airline said it has adopted a dividend policy under which it will pay an annual dividend of up to 20 percent of its net operating profit, starting this year. It declared a special dividend of 18 sen per share after announcing 2012 core net income of MYR858.23 million ringgit (USD$276.67 million), a marginal increase on the previous year.
Including a one-off gain of MYR1.16 billion ringgit from a sale of shares in its Thai operation, full year profit was MYR1.88 billion.
"The company has formalized the dividend policy... as part of our plans to give more certainty every year to shareholders," chief executive of Malaysian operations Aireen Omar said in a statement on Tuesday.
AirAsia plans this year to set up a new airline in India, in a joint venture with Tata, but will face stiffer competition in its home market of Malaysia.
Malindo Air, a joint venture between Lion Air of Indonesia and Malaysia's National Aerospace & Defense Industries, has received approval from Malaysian authorities to start operations and will offer low-cost flights from March, it said on Tuesday.
"Despite the surprise payout for 2012, we have not projected any potential dividend for 2013 and 2014 as we prefer to be cautious on the company's outlook for this year in view of the entry of Malindo," analysts at OSK Research said in a note on Wednesday.