MAG group managing director Datuk Captain Izham Ismail.
KUALA LUMPUR: Malaysia Aviation Group Bhd (MAG), the parent company of Malaysia Airlines Bhd (MAB), has demonstrated resilience in its performance for the financial year ended Dec 31, 2024 (FY24), posting a net profit of RM54mil – marking another year of profitability.
The achievement, coupled with an operating profit of RM113mil and robust earnings before interest, taxes, depreciation and amortisation (Ebitda) of RM788mil, underscored the aviation group’s ability to navigate significant operational challenges – including an 18% capacity reduction in the fourth quarter of 2024 (4Q24) due to supply chain disruptions, extended maintenance times and delays in new aircraft deliveries.
MAG’s FY24 net profit was further bolstered by a RM426mil impairment reversal on assets including aircraft, property, plant, equipment and intangible assets.
These impairments, initially recognised during the Covid-19 lockdowns in 2020, were reversed following improved capacity, revenue, seat factor and yield in 2023 and 2024.
Despite a marginal 1% year-on-year (y-o-y) revenue decline to RM13.68bil, due to the 4Q capacity cuts, MAG recorded a 6% increase in available seat kilometre, reflecting its focus on operational efficiency.
Group managing director Datuk Captain Izham Ismail pointed out that the capacity reductions, implemented during a traditionally strong quarter, were a strategic response to external pressures.
He added that without those cuts, MAG could have achieved a RM580mil profit, boosted by its cargo and non-airline segments that helped buffer the dip in passenger revenue.
“As we work towards our vision Destination 2030, a future of stability and growth, we remain deeply focused on two guiding principles, which are commercial sustainability and nation building,” Izham said during a briefing on MAG’s 2024 performance yesterday.
He revealed that a cornerstone of MAG’s Destination 2030 strategy is its investment in fleet modernisation, projecting that by 2030, the group aims to operate a new-generation narrowbody fleet of 55 Boeing 737-8 and 737-10 aircraft to enhance noth domestic and international connectivity.
The group is also progressively integrating A330neo aircraft into its long-haul network, with two already deployed on routes to Melbourne, Bali and Auckland. Eight more are expected to join the fleet in 2025.
Izham noted these upgrades are aimed at improving operational efficiency and customer experience, while also supporting MAG’s sustainability goals.
Passenger traffic remained strong in 2024, particularly in the premium segment, with an overall load factor of 80%, up from 77% in 2023.
MAG also expanded its network by adding three new destinations – Male (Maldives), Da Nang (Vietnam) and Chiang Mai (Thailand) – and resuming flights to Kolkata (India).
Izham also highlighted that forward bookings rose 9% y-o-y, as the group plans to strengthen its presence in key markets, including Asean, Australia, New Zealand and South Asia.
A notable addition to its network is the return to Paris, marking its second European destination.
Meanwhile, MAB, MAG’s flagship carrier, posted an operating profit of RM139mil in 2024, an 87% decline from RM1.09bil in 2023, primarily due to lower yields and the impact of the 4Q capacity cuts.
However, the airline saw a 7% increase in capacity, a 17% rise in passengers carried and a load factor of 81%, up from 77% in 2023.
Aircraft constraints limited on-time performance improvements to just a 1% y-o-y increase.
Firefly, MAG’s regional subsidiary, saw its losses widen due to jet operations from Subang Airport, despite a 10-percentage-point increase in load factor.
Yields dropped by 19%, reflecting operational challenges.
On a positive note, Amal by Malaysia Airlines, the group’s haj and umrah service, reported a 36% y-o-y improvement in financial performance, highlighting its growing contribution to MAG’s portfolio.
Notably, MAG’s non-airline segments delivered strong results.
MAB Kargo, the cargo division, posted higher operating profits, driven by increased capacity and improved load factors for both belly and freighter cargo, which grew by eight percentage points and three percentage points, respectively.
AeroDarat Services, MAG’s ground handling provider, achieved a threefold increase in operating profit, fuelled by higher flight volumes for MAG and foreign carriers.
MAB Academy, the training arm, also showed improved results, while MAB Engineering Services faced challenges due to skilled workforce shortages.
Separately, Izham clarified that MASwings, which was transferred to the Sarawak state government in February through a sale and purchase agreement, is a public service obligation organisation that generates no profit but receives an annual government incentive of approximately RM10mil.
“It’s a zero-sum game,” he said, emphasising that the handover will not impact MAG’s profit and loss statement, and will allow the group to focus on its core operations.
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