AirAsia X turns around Australian performance Aviation Jamie Freed Lower capacity has helped.
AirAsia X's fortunes are improving in the Australian market, after the low-cost carrier and rival Malaysia Airlines dramatically cut capacity between Australia and Kuala Lumpur in 2015. 
The   December quarter financial figures for long-haul, low-cost carrier AirAsia X show its Australian division swung to a pre-tax profit of 53.4 million ringgit ($17.9 million), up from a $90.5 million ringgit pre-tax loss for the same period the previous year. However, for the full calendar year AirAsia X reported a loss before tax of $232 million ringgit, or $77.6 million in Australian currency.
The latest available international capacity statistics for   November show AirAsia X lowered capacity by 13.7 per cent compared with a year earlier, as it pulled out of Adelaide and trimmed some frequencies to other Australian cities.
Malaysia Airlines' capacity decreased 36 per cent over the same period, after it dropped Brisbane and lowered frequencies to other destinations, and it offers fewer seats a month now than AirAsia X.
Both carriers are benefiting from the fall in the fuel price, although some of those gains have been offset by the weak Malaysian currency against the US dollar.
AirAsia X chief executive Ben Ismail said the economics of his carrier's Sydney and Melbourne flights had "improved considerably", but Perth had been a tougher market, after Malaysian carrier Malindo Air began daily flights to Kuala Lumpur in   November.
"It could be better," he said. "We have a Malaysian carrier that is pricing aggressively in the market."Malaysia Airlines chief executive Christoph Mueller said Perth had become more "price sensitive" since Malindo's entry but his airline was "doing OK" because it was a more established brand.
Mr Ismail said AirAsia X's yields in the Australian market were rising, but they remained considerably lower than Malaysia Airlines, which is a full-service carrier with less-dense aircraft.
But he said Malaysia Airlines' decision to abandon Brisbane had proven positive for its Gold Coast route, with a bus company adding more capacity between Gold Coast and Brisbane to meet demand.
The airline is also launching flights between Gold Coast and Auckland, although Mr Ismail said much of the demand for that was Asian travellers heading to Auckland.