SEPANG: MALAYSIA AIRPORTS HOLDINGS BHD (MAHB) reported a smaller net loss of RM19.88mil for the second quarter ended June 30, in line with analysts’ expectations.
Analysts had earlier expected the airport operator to remain in the red in the second quarter, with a better performance in the second half.
MAHB said the net loss narrowed in the second quarter due to the earnings from the acquisition of Turkey’s Istanbul Sabiha Gokcen International Airport (ISG) and LGM Havalimani Isletmeleri Ticaret ve Turizm (LGM).
Overall, it added that the company’s net loss was due to the amortisation of fair value for the concession rights on the acquisition of ISG and LGM.
Its revenue for the second quarter slipped 20% to RM939.96mil from RM1.17bil a year ago.
In the first six months to June 30, MAHB’s net profit plunged 85.4% to RM12.24mil compared with RM84.03mil a year ago.
Commenting on its second-quarter results, managing director Datuk Badlisham Ghazali said it was not an apple-to-apple comparison.
“In the first half of 2014, we were still booking in construction revenue of KLIA2. We didn’t have ISG either in the first half of last year,” he explained.
Nonetheless, Badlisham said the company was holding on to its headline key performance indicator for the year and would maintain its passenger growth target.
“We are doing well as a holding company. We are pleased with ISG’s performance. It was better than expected. The outlook still looks bright,” he said at a briefing to announce its second-quarter financial results yesterday.
Despite the flat passenger growth in the first half of the year, Badlisham foresees a positive trend moving forward and is maintaining its 3% passenger growth this year.
In addition, he expects more airlines to be flying in this year on top of British Airways and All Nippon Airways.
“We do have headwinds. Malaysia Airlines for example. Their firm plans have not come out. It is pointless for us to anticipate.
“We are also watching the gross domestic product growth. It is, after all, a major function of travel growth with disposable income,” Badlisham explained.
Asked if the current political situation had any bearings on MAHB, he said there was “no model” for MAHB to benchmark against.
“There is no model for politics for us to correlate. We have a model for natural disasters or unrest like in Thailand,” Badlisham said.
On the maintenance of KLIA2, Badlisham said the company spent a considerable amount of its operating cost to maintain KLIA2 and it was “part and parcel of its operating costs.”
He said the company had spent some RM83mil last year, and out of that amount, RM25mil was for KLIA, RM24mil for KLIA2 and the low-cost carrier terminal (LCCT), RM6mil for the Kota Kinabalu airport and RM6mil for the Penang airport.
Badlisham said moving back to the LCCT was not a feasible option, as it would not be able to cater to the current passenger traffic.
He said the LCCT catered to 15 million passengers per annum (mppa) while the current passenger traffic at KLIA2 was about 24 mppa.
Furthermore, Badlisham said MAHB had stripped out air-conditioning, removed chairs and disassembled baggage handling to be used at other airports. The LCCT is to be turned into a global cargo and logistics hub.
He said MAHB had put in sensors on the ground to note the area that was affected at KLIA2, and the maintenance works were expected to taper off to a minimum level in the next five years.
He apologised for the inconvenience but said it was not feasible to stop and do the works at KLIA2 all at one go. He said there would still be settlements later.
Badlisham noted that a Joint Inspection Committee by KLIA2 stakeholders had been meeting to raise and resolve any operational issues, including the update on the rectification works.