MALAYSIA Airlines (MAS) managed to swing back into profitability with a net profit of RM230mil for the third quarter ended Dec 31, 2003, on higher passenger and cargo load.
It reported sales of RM2.5bil, a 11.7% improvement over the RM2.2bil a year ago. Earnings per share, at 18.3 sen, was much lower than the 42.91 sen recorded in the corresponding period a year ago, as net profit fell 30.4% from the RM330mil before.
MAS managing director (MD) Datuk Md Nor Yusof, presenting the results, said: “It had been a very busy, productive third quarter, with favourable implications. Our strong performance has more than offset the financial setback presented by severe acute respiratory syndrome in the first quarter. Our liquidity position is strong.
“Now, in the second month of the final quarter, the airline has reason to look with optimism to a fine finish for the financial year ending March 31, 2004,” he told journalist and analysts at the MAS Academy in Kelana Jaya yesterday.
This was probably one of the last few briefings he would give the media as MD of MAS. He leaves MAS at the end of March to take up the job of Securities Commission chairman on April 1.
For the nine months ended Dec 31, 2003, MAS reported a net profit of RM167mil, 33.5% lower than the RM250mil in the corresponding period of 2002. Revenue dipped by 7.6% to RM6.3bil, from RM6.8bil before.
An analyst said the figures ''had exceeded my expectations of RM120mil, and now I am a firm believer in MAS.''
Another analyst said the figures were within expectations and, for the full year, he expected MAS to post between RM310mil and RM320mil in net profit.
For FY2005, analysts said, they would not be surprised if it was in the RM500mil to RM600mil bracket.
Md Nor said, in terms of weekly flights, MAS did 2,700 in the third quarter, compared with 2,500 in the second quarter. He added that passenger volume for January had also gone up.
MAS carried 4.1 million passengers – 1.97 million on international routes, for a seat factor of 69.9%, and 2.1 million on domestic routes, for a seat factor of 73%. Total cargo tonnage flown reached 115,000 tonnes.
The company has cash reserves of RM1.9bil, which is seen as sufficient in case of adversity.
Fuel cost remained highest on its expenditure list and increased to RM531mil from RM470mil a year ago. Handling and landing fees rose, but so did maintenance and overhaul costs. MAS managed a gain of about RM20mil as a result of currency fluctuations.
MAS senior general manager (network and revenue management) Paul A. Mooney said forward bookings for the airline would be better in the first six months of 2004 compared with 2003, and the airline had experienced strong sales in January.
On the bird flu outbreak in the region, Mooney said it was a minor jitter; MAS Travel Fair 2004 had helped to stimulate and regain consumer confidence in travel.
MAS senior general manager (sale, distribution and marketing) Datuk Ahmad Fuaad Dahlan said the travel fair would help contribute to the group's fourth quarter results. He expects it to be a yearly event, and MAS would likely not be a dominant player at the forthcoming MATTA fair since it now organised its own MAS Travel Fair, which he termed as ''very successful.''
Asked on the business strategy for FY2005 – the MAS board and management met up in Langkawi last weekend – Md Nor said: ''We have re-validated the current plans.''
MAS' focus going forward would remain on regional markets that offer high yields, such as India, China and Asean.
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