MAS losses narrow
Malaysia Airlines (MAS) saw improved financial results in the first quarter of 2012, but not enough to prevent the airline registering fifth consecutive quarterly loss.
The airline posted a MYR71 million (US$22.7 million) net loss in the three months to 31 March 2012 – significantly better than the MYR242 million loss it recorded in Q1 2011.
Total revenue stood at MYR3.11 billion, despite an 8% drop in passenger traffic following the termination of services on 12 routes as part of a major cost-cutting plan.
“We cut unprofitable routes especially in long haul where yields were low. This helped us to immediately improve our revenue per available seat kilometre performance year-on-year. On the cost side, we lowered our fuel bill with improved consumption as a result of newer fuel-efficient aircraft,” explained the airline’s Group CEO, Ahmad Jauhari Yahya.
“Improved cost management was also seen for non-fuel variable costs, although we are currently unable to address our fixed costs. We are optimistic this situation will change in the not too distant future. From these Q1 results, we feel confident of continuing improvements in performance, given that the initiatives from our business plan are bearing fruit,” he added.
Group operating expenses for the quarter totalled MYR3.42 billion, 3.1% lower than the same quarter last year. Fuel remained the largest component at 38%, equivalent to MYR1.31 billion – a year-on-year increase of MYR142 million. Staff cost increased 7% to MYR591 million.
Despite the gloomy outlook, Ahmad Jauhari said MAS planned to “win back more customers” with its fleet renewal programme. “This year, 23 new aircraft equipped with state-of-the-art passenger amenities will join our fleet. This is led by our flagship A380 aircraft which is on schedule to enter into service on 1 July 2012. Supported by intensified sales and marketing, we are confident of improving our customer base to boost yield and load factors,” he said.
The Q1 2012 loss follows on from a MYR2.53 billion net loss in full-year 2011.