PETALING JAYA: MALAYSIA AIRPORTS HOLDINGS BHD’s (MAHB) share price fell 4% to RM7.26 on news of CEO Raja Azmi Raja Nazuddin departing his role on Monday.
Raja Azmi’s resignation came a year after his appointment and marked the second change in MAHB’s management team since the appointment of chief finance officer (CFO) Mohamed Rastam Shahrom on Dec 31, who formerly served at UEM SUNRISE BHD.
MAHB chief operating officer Datuk Mohd Shukrie Mohd Salleh (pic), who joined MAHB on May 1,2019, has been appointed as the acting group CEO with immediate effect.
According to a source, the new potential candidate to helm MAHB could be selected either internally or externally.
“Most importantly, the appointment of MAHB’s CEO should be merit-based, ” a source said.
Another source added that besides the change in MAHB’s management, the airport operator has to improve on its working relations with domestic airlines, in particular.
“MAHB should also make greater efforts to attract more airlines to Malaysian airports and work on ways to make the airports more user friendly, ” the source said.
At midday, MAHB’s share price declined 2.91% or 22 sen to RM7.34.
MAHB was the third biggest loser yesterday with shares traded on a volume of 5.72 million.
On Monday, MAHB said Raja Azmi resigned from his CEO role to pursue other opportunities. “The board would like to thank Raja Azmi for his services and would like to wish him well in his future endeavours.
“As a public-listed company, MAHB will be undertaking the proper process to identify and appoint a suitable successor, ” it said in a statement.
Raja Azmi joined MAHB as CFO in February 2016 before he was promoted as CEO in January last year.
MAHB recorded a 17.44% higher net profit of RM197.87mil in the third quarter ended September 30,2019 as its airports saw a pick-up in passenger traffic.
Higher passenger numbers contributed to 10.22% year-on-year (y-o-y) overall revenue growth of RM1.36bil.
Revenue from its airport operations alone was 10.7% higher at RM1.28bil, following improved contributions from both the aeronautical and non-aeronautical segments.
In terms of passenger traffic, MAHB recorded overall growth of 6.7% y-o-y.
According to Kenanga Research, MAHB continues to be an attractive proxy to the propensity for air travel due to rising per capita income.
“MAHB is well-entrenched because of its monopolistic position as an airport operator in Malaysia, while earnings are protected from downside in the aeronautical segment under the operating agreements.
“A key component under the operating agreements is the Marginal Cost Support Sums (MARCS) system, which would compensate MAHB for a reduction in aeronautical Passenger Service Charge (PSC).
“This results in the PSC rate being lower than the benchmark rate as per the operating agreements due to governmental instructions, ” said Kenanga Research in a recent aviation sector report.
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