MAS Pre-Tax Profit Falls To RM282.03 Million

[BC Tam 2]

We need Idris Jala back to do BTP3 for MH.

And what do they have nowadays to attract him to the 'new challenge' ?

Most if not all family heirlooms already disposed off

[N Azman 0]

May I remind you that MAS had TWO business turnaround plans because the airline was in serious trouble. You do not need complications like diversification of business to compromise your business turnaround. The whole purpose of the plans was to stabilise the ship so that it can be restructured. MAS is still shaky at the moment and is in no position to diversify. That will only cause more complications. Let's stabilise the ship first, then expand and diversify.

 

Any responsible management will look at best practices of all airlines. I am sure that MAS has learnt a few things from AirAsia and applied them to Firefly and themselves. The Firefly CEO has said that he is running FY on LCC principles.

 

Reacting to LCC competition and taking them on head on, as MAS are doing, are two different things.

 

Yes, SQ and Silk Air are reacting to LCC competition. Silk Air is a full service carrier and SQ is merely re-aligning its cost base when it handed over routes to them. They have to deploy their resources more carefully and are cutting wastage.

 

LH, QF and SQ have not taken them on head on. They have set up separate units that are LCCs, with different management teams, so that they stay focussed on their tasks. There is no brand and product confusion. MAS has thrown everything in the rojak pot and the 2010 results clearly reflect their folly.

 

Stabilise the ship. So, at what point will you say "ok, the ship has stabilised enough (not perfect), but lets grow"? Let me also remind you that most of all FSC were in the doldrums in 2009, and picked up speed in 2010. Sure, you're right to say MH is slower amongst its peers but at some point you need to grow, in an industry where everyone is growing. Keep pace or get out of the kitchen. Also, i'd like to remind you that even though MH's margin is low, they WERE profitable in 2010 which signals green light for growth. You'd be kicked out of the board if you insist on "hospital mode with zero growth" even after a profitable year.

 

theres still two ways to make money : boost revenues or cut costs. expansion is boosting revenues.

 

It very much sounds like you make whatever SQ and everyone else do in reaction to LCCs as "best practise", but whatever MH do, you consider as "rojak". And how do you define HEAD ON vs "best practices of reacting to LCCs"? it looks roughly the same to me... silk and SQ got parallel routes also....codeshare also....so does LHRegional and its parent...got parallels and got synergies. All airlines above do deep discoutns on certain leisure LCC heavy route.... so?

 

you're either tailoring your arguments to fight me, or tailoring it to make MH look bad. trust me, all airlines have cannibalised, diluted and wrongfooted their way in fighting the LCC. even SQ and LH.

 

LH, QF and SQ have not taken them on head on. They have set up separate units that are LCCs, with different management teams, so that they stay focussed on their tasks. There is no brand and product confusion. MAS has thrown everything in the rojak pot and the 2010 results clearly reflect their folly.

 

i see self contradiction here. Silk is not an LCC you said. but then you said SQ have created a separate LCC.

 

So what do you call firefly then? not a separate unit LCC? is this considered the rojak pot? is deep discounting considered rojak pot? uhhh...KLM also does it with citilink routes and also LH so do they rojak as well or do they not have rojak in europe so they are all best practise...

 

brand and product confusion? so Silk fighting LCCs with a full service model is NOT a product confusion.....and FY fighting LCC with and LCC model is product confusion? are you confused with FY+MH but not confused with GMW+LHR+LH and SQ+Silk and KL+KLCitilink and CX+Dragon?

 

seriously.....

[Mohd Azizul Ramli 2]

MI (SilkAir) is not a LCC. SQ's LCC is Tiger Airways (it is a subsidiary of Tiger Airways Holdings, a Singapore-based company, which is owned partially by Singapore Airlines). Singapore Airlines Group operates with 3 prong strategy SQ-MI-TR.

[N Azman 0]

MI (SilkAir) is not a LCC. SQ's LCC is Tiger Airways (it is a subsidiary of Tiger Airways Holdings, a Singapore-based company, which is owned partially by Singapore Airlines).

 

ahaa you're right! i forgot about that cat! so kinda like FY then? a separate LCC entity right?

 

so what do we call MI then? a short haul full service narrowbody subsidiary? why cant I just have a narrowbody SQ? but of course, lets not argue with best practices.

 

Like i said, I fail to see how one can get absolute best practise clarity on SQ+MI+Tiger (w is tiger's icao?)

but still manage to confuse MH+FY.

[c.lee 0]

so what do we call MI then? a short haul full service narrowbody subsidiary?

Correct. MI is a short haul FSC of SQ.

 

Like i said, I fail to see how one can get absolute best practise clarity on SQ+MI+Tiger (w is tiger's icao?)

but still manage to confuse MH+FY.

Tiger Airways IATA code is TR (ICAO: TGW).

 

FY itself is pretty confusing for typical passengers. FY's ATR division is marketed as a "community airline", similar to MI. However, their 738/734 division is marketed as an LCC. So, FY is playing the roles of both MI and TR.

 

But you are right. Anyone who can get absolute best practise clarity on SQ+MI+TR should not have any confusion towards MH+FY.

[flee 5]

Stabilise the ship. So, at what point will you say "ok, the ship has stabilised enough (not perfect), but lets grow"? Let me also remind you that most of all FSC were in the doldrums in 2009, and picked up speed in 2010. Sure, you're right to say MH is slower amongst its peers but at some point you need to grow, in an industry where everyone is growing. Keep pace or get out of the kitchen. Also, i'd like to remind you that even though MH's margin is low, they WERE profitable in 2010 which signals green light for growth. You'd be kicked out of the board if you insist on "hospital mode with zero growth" even after a profitable year.

If I remember correctly, they were still route rationalising in 2010, the latest casualty was the KUL-ARN-EWR route. An airline grows by expanding its routes and frequencies. If MH has not completed its route rationalisation, it should make this a priority so that it can align its capacity in line with demand. The board should focus and not be distracted.

 

It very much sounds like you make whatever SQ and everyone else do in reaction to LCCs as "best practise", but whatever MH do, you consider as "rojak".

In SQ's case, Tiger Airways is a separate listed company on the SGX. They have their own corporate structure and report their own numbers. FY's numbers are consolidated into MH's accounts. That is why I refer to it as rojak. FY's CEO says that they are profitable. But we are not privy to their financial performance, unlike Tiger Airways.

 

you're either tailoring your arguments to fight me, or tailoring it to make MH look bad. trust me, all airlines have cannibalised, diluted and wrongfooted their way in fighting the LCC. even SQ and LH.

This is a discussion. If we do not refer to each other's posting, then it is not a discussion. I have no intention of making MH look bad or good. I am just commenting on the facts (MH's 2010 results) but you obviously took exception to my comments.

 

This is not government media, where reporting is one sided. Here we have many views and many viewpoints. Yours is one view and mine is another. And I am sure others will also have their own views.

 

i see self contradiction here. Silk is not an LCC you said. but then you said SQ have created a separate LCC.

 

So what do you call firefly then? not a separate unit LCC? is this considered the rojak pot? is deep discounting considered rojak pot? uhhh...KLM also does it with citilink routes and also LH so do they rojak as well or do they not have rojak in europe so they are all best practise...

 

brand and product confusion? so Silk fighting LCCs with a full service model is NOT a product confusion.....and FY fighting LCC with and LCC model is product confusion? are you confused with FY+MH but not confused with GMW+LHR+LH and SQ+Silk and KL+KLCitilink and CX+Dragon?

I think Azizul has explained that Tiger is the LCC that SQ has created. SilkAir has been around for a long time, it was created in 1989 as a holiday destination airline. In the ensuing years, it became SQ's regional airline so that SQ can focus on long haul operations.

 

SQ is now more integrated with Silk Air (MI) because it is responding to LCC competition. For example, on the KUL-SIN route, SQ is rebalancing its capacity with MI so that their B772s and A333s continue to fly with reasonable load factors.

 

MH tried to be an LCC - remember those snack boxes that had passengers fuming? It also tried to cut fares to LCC levels when its costs are still high. That did not work did it? Even now, pax who booked on MH are not happy to be on a FY code shared flight. So MH still has some way to go in terms of being able to differentiate MH and FY products and branding.

 

BTW, KLM also has its own LCC. Its called Transavia.

 

And how do you define HEAD ON vs "best practices of reacting to LCCs"? it looks roughly the same to me...

Head on means MH is trying to match everything that LCCs like AirAsia do. Even right down to advertisements in the media! Hopefully they learnt their lesson and that they will change. It is better to reinvent yourself so that customers know that you are not like AirAsia. You have your own product and services that carry your identity and uniqueness. That is what many full fare carriers are trying to do. Airlines like EK, SQ and other A380 operators are using that aircraft as a marketing tool. So lets hope that MH learns something from them when the time comes. MH are not a LCC and should start competing with their peers like SQ, TG, CX etc.

[Mohd Azizul Ramli 2]

My understanding from flee's rojak argument is that, although MH has made the right move to set up FY to take on the LCC market for their group, there are still some conflicts within MH itself. For instance:

 

- MH current marketing and branding always seem to counter the threats from AK and its group of airlines instead of taking on SQ or EK on the global stage. Remember the spat about using a certain font and colour for print ads not too long ago?

 

- MH has had 0 fare/free seat promotions in the past to counter AK's. I don't think there is any other FSC in the world that has gone to that level of promotion to tackle competition from a LCC rival.

 

- Since 15 January 2011, where FY officially joined the mainstream arena on the KUL-KCH and KUL-BKI market, logically we should expect a reduction in MH flights, in view that some of MH flights should be transferred to FY. Although FY announced very recently about the increase of frequency to BKI and KCH and some new destinations and routes also served by MH, there is no information that MH is reducing their flights. It indicates that MH is continuing taking on AK and also competing against FY on those routes. This should not be happening.

 

- In the case of SQ-MI-TR, we agree that there is some overlapping in the routes that the 3 airlines are serving (all 3 airlines serve KUL-SIN vv), but it is unlike the case of MH and FY where the clear cut and target market segment is still vague. MH has 9 daily KUL-KCH vv flights before and FY is planning 4 daily flights soon and MH 9 daily service is still intact. So what is the strategy here for the MH group of airlines? The domestic market in Malaysia is only growing by 3% in 2010 which does not justify the extra capacity. Can these extra capacity improve MH and FY's yield and load factor? I don't think so.

 

We really hope that MH can set itself from FY the way QF and JQ did. I think that should be the benchmark. Like flee mentioned, FY's expenses is hidden somewhere in MH's group level accounts so there is no transparency over there. Uncle Tony has raised his concern over this issue. We certainly do not want the incident where FY is claiming that it is profitable but the actual fact is that it is the one making losses for the group. Delta's Song comes to mind. With MH being a Malaysian GLC with a proven very slow management, chances that this could happening is likely.

[N Azman 0]

If I remember correctly, they were still route rationalising in 2010, the latest casualty was the KUL-ARN-EWR route. An airline grows by expanding its routes and frequencies. If MH has not completed its route rationalisation, it should make this a priority so that it can align its capacity in line with demand. The board should focus and not be distracted.

 

 

In SQ's case, Tiger Airways is a separate listed company on the SGX. They have their own corporate structure and report their own numbers. FY's numbers are consolidated into MH's accounts. That is why I refer to it as rojak. FY's CEO says that they are profitable. But we are not privy to their financial performance, unlike Tiger Airways.

 

 

This is a discussion. If we do not refer to each other's posting, then it is not a discussion. I have no intention of making MH look bad or good. I am just commenting on the facts (MH's 2010 results) but you obviously took exception to my comments.

 

This is not government media, where reporting is one sided. Here we have many views and many viewpoints. Yours is one view and mine is another. And I am sure others will also have their own views.

 

 

I think Azizul has explained that Tiger is the LCC that SQ has created. SilkAir has been around for a long time, it was created in 1989 as a holiday destination airline. In the ensuing years, it became SQ's regional airline so that SQ can focus on long haul operations.

 

SQ is now more integrated with Silk Air (MI) because it is responding to LCC competition. For example, on the KUL-SIN route, SQ is rebalancing its capacity with MI so that their B772s and A333s continue to fly with reasonable load factors.

 

MH tried to be an LCC - remember those snack boxes that had passengers fuming? It also tried to cut fares to LCC levels when its costs are still high. That did not work did it? Even now, pax who booked on MH are not happy to be on a FY code shared flight. So MH still has some way to go in terms of being able to differentiate MH and FY products and branding.

 

BTW, KLM also has its own LCC. Its called Transavia.

 

 

Head on means MH is trying to match everything that LCCs like AirAsia do. Even right down to advertisements in the media! Hopefully they learnt their lesson and that they will change. It is better to reinvent yourself so that customers know that you are not like AirAsia. You have your own product and services that carry your identity and uniqueness. That is what many full fare carriers are trying to do. Airlines like EK, SQ and other A380 operators are using that aircraft as a marketing tool. So lets hope that MH learns something from them when the time comes. MH are not a LCC and should start competing with their peers like SQ, TG, CX etc.

 

1) not to nitpick, but ARN EWR was suspended in 2009, in a bad year. 2010 has been observed to be a growth year. they've been growing since. rationalisation is over for now my dear. if youre gonna be dr.obvious and point out minor route changes, dude, that happens everyday in every airline.

2) so if you don't see the financial figures and have them justify its synergy to joe public, its rojak then? fair enough. now that you've put it that way, its unarguable. illogical, but unarguable. what about D7 then? rojak buah? pasembor? AK trying to be FSC?

3) snack boxes = trying to be LCC? wow. a very gross generalization. I'd be angry at them for reducing service levels but to say theyre trying to be LCC is like saying im now a mass murderer for spraying shelltox all over the front yard. again, illogical, but unarguable since u put it that way.

4) codeshares = so SQ passengers are completely happy to be on MI? i know im not. too bad lar thats what codeshares are all about. frequencies. not product equalisation. name me two IDENTICAL products on codeshare you can find globally. there's bound to be an unhappy roger. i still dont get what you find confusing with MH+FYszb and FYkul. there's been endless ads threads topics articles on this.

 

So, head on means trying to match everything like Airasia. and yet, I constantly see people complaining here about high fares. people complain everytime about MH fares being high even during promo... are you generalizing again?

 

KLM fares on KUL-CGK fell to RM 270 all in last year. So are they trying to be LCC now? american FSC carriers pulled meals from medium haul flights, and no more pillows on some redeyes. is everyone trying to be LCCs now? some prominent FSC started to charge for ancillaries like roomy exit row seats....shall i sound the LCC alert? have they gone bonkers and lost the plot??

 

i think you get my point by now.

[N Azman 0]

- MH current marketing and branding always seem to counter the threats from AK and its group of airlines instead of taking on SQ or EK on the global stage. Remember the spat about using a certain font and colour for print ads not too long ago?

 

- MH has had 0 fare/free seat promotions in the past to counter AK's. I don't think there is any other FSC in the world that has gone to that level of promotion to tackle competition from a LCC rival.

 

- Since 15 January 2011, where FY officially joined the mainstream arena on the KUL-KCH and KUL-BKI market, logically we should expect a reduction in MH flights, in view that some of MH flights should be transferred to FY. Although FY announced very recently about the increase of frequency to BKI and KCH and some new destinations and routes also served by MH, there is no information that MH is reducing their flights. It indicates that MH is continuing taking on AK and also competing against FY on those routes. This should not be happening.

 

- In the case of SQ-MI-TR, we agree that there is some overlapping in the routes that the 3 airlines are serving (all 3 airlines serve KU-SIN vv), but it is unlike the case of MH and FY where the clear cut and target market segment is still vague. MH has 9 daily KUL-KCH vv flights before and FY is planning 4 daily flights soon and MH 9 daily service is still intact. So what is the strategy here for the MH group of airlines? The domestic market in Malaysia is only growing by 3% in 2010 which does not justify the extra capacity. Can these extra capacity improve MH and FY's yield and load factor? I don't think so.

 

We really hope that MH can set itself from FY the way QF and JQ did. I think that should be the benchmark. Like flee mentioned, FY's expenses is hidden somewhere in MH's group level accounts so there is no transparency over there. Uncle Tony has raised his concern over this issue. We certainly do not want the incident where FY is claiming that it is profitable but the actual fact is that it is the one making losses for the group. Delta's Song comes to mind. With MH being a Malaysian GLC with a proven very slow management, chances that this could happening is likely.

 

Wow, you guys certainly are hard to please. So in order to believe MH is doing an OK job, you want:

 

1) complete separation of financial figures between MH and FY (even though theyre not obligated to do so) and what about D7? no $ figures? buried costs too? do i hear cannibalisation whilst being unprofitable?

2) reduction of capacity on MH where FY is flying, clearly allowing only MH+AK or FY+AK on routes. notice the common denominator there?

3) No more cheap deals on MH

4) A public marketing spat between MH SQ and EK (since you obviously do not notice the underlying counteract strategy these airlines do to one another in the market through fare benchmarking, incentives, GDS strategies, etc)

 

do you work for airasia?

[Mohd Azizul Ramli 2]

2) so if you don't see the financial figures and have them justify its synergy to joe public, its rojak then? fair enough. now that you've put it that way, its unarguable. illogical, but unarguable. what about D7 then? rojak buah? pasembor? AK trying to be FSC?

D7's accounts is not part of AK group level accounts. People don't do account consolidation on a 16% owned associate company.

[N Azman 0]

D7's accounts is not part of AK group level accounts. People don't do account consolidation on a 16% owned associate company.

 

and neither do people reveal associate companies' financial figures that could only benefit competitors. It's called doing business.

[flee 5]

2) so if you don't see the financial figures and have them justify its synergy to joe public, its rojak then? fair enough. now that you've put it that way, its unarguable. illogical, but unarguable. what about D7 then? rojak buah? pasembor? AK trying to be FSC?

It is known as transparency and accountability.

 

FY is a 100% subsidiary of MH - so its numbers are hidden inside MH's financial statements. There is no segmental reporting here. The AK group airlines do report their numbers. So we can see what is going on in FD and QZ. D7 is not a group member but all these airlines will be going for IPO this year. So, transparency and accountability will be even better than ever.

 

Is it any surprise that analysts are better able to understand AirAsia group airlines better than MH's rojak pot?

[Mohd Azizul Ramli 2]

Wow, you guys certainly are hard to please. So in order to believe MH is doing an OK job, you want:

 

1) complete separation of financial figures between MH and FY (even though theyre not obligated to do so) and what about D7? no $ figures? buried costs too? do i hear cannibalisation whilst being unprofitable?

2) reduction of capacity on MH where FY is flying, clearly allowing only MH+AK or FY+AK on routes. notice the common denominator there?

3) No more cheap deals on MH

4) A public marketing spat between MH SQ and EK (since you obviously do not notice the underlying counteract strategy these airlines do to one another in the market through fare benchmarking, incentives, GDS strategies, etc)

 

do you work for airasia?

MH is obviously not doing an OK job. Not after everyone knows that their Cost of Sales is higher than their RM 13 billion revenues and that the RM 200+ million net profit are gained through derivatives.

 

1) As mentioned in the earlier reply, AirAsia X Sdn. Bhd. is not part of AK group. It was never in AK's group level accounts because AK only owns 16% of its shares.

 

2) I am not suggesting a complete MH+AK or FY+AK on a certain route. Like the example I gave for SQ-MY-TR where all 3 airlines serve KUL-SIN vv, the issue I have is the non reduction of frequency of MH flights. It's like MH does not have any data at all about the demand of its FSC flight on that particular route. If MH has identified that it has an X amount of demand on KUL-KCH through 9 daily flights with average load factor of 65%, surely an addition of 4 FY flights on the route would decrease that X demand by a certain %. But this is not happening. As I mentioned, the domestic market is only growing by 3% in 2010 so the extra capacity will only further decrease MH and FY yield and load factor. My idea is that for this exhibit, MH should have maybe only 5 daily KUL-KCH flight and a new 4 flights with FY. That way, FY flights can achieve a healthy load factor while competing against the market that AK is in while the 5 MH flights are to cater for FSC passengers. That way, MH group of airlines can rake in optimum yield and load factor for all of its MH and FY flights. There are market for everyone. It's just that MH need to adjust its capacity based on demand of its target market segment. The understanding that I have is that MH and FY are after different market segments.

 

3) Even SQ conducts sales sometimes to boost sales. But not in the way MH did in the past. SQ did not offer 0 fare/free seat flights on SIN-KUL vv just because AK did. Btw, SQ has an ongoing promotion of RM 454 all in return as we speak.

 

Me working for AK? If you care to click on the FlightMemory banner that follow all my 2,460 posts in this forum (and counting) [the blue banner next to the 3 EK girls at my siggy], you should be aware that I have never flown AK in my entire lifetime except for 2 flights with D7 and also, which airlines I flew the most. Any guess?

[flee 5]

2) I am not suggesting a complete MH+AK or FY+AK on a certain route. Like the example I gave for SQ-MY-TR where all 3 airlines serve KUL-SIN vv, the issue I have is the non reduction of frequency of MH flights. It's like MH does not have any data at all about the demand of its FSC flight on that particular route. If MH has identified that it has an X amount of demand on KUL-KCH through 9 daily flights with average load factor of 65%, surely an addition of 4 FY flights on the route would decrease that X demand by a certain %. But this is not happening. As I mentioned, the domestic market is only growing by 3% in 2010 so the extra capacity will only further decrease MH and FY yield and load factor. My idea is that for this exhibit, MH should have maybe only 5 daily KUL-KCH flight and a new 4 flights with FY. That way, FY flights can achieve a healthy load factor while competing against the market that AK is in while the 5 MH flights are to cater for FSC passengers. That way, MH group of airlines can rake in optimum yield and load factor for all of its MH and FY flights. There are market for everyone. It's just that MH need to adjust its capacity based on demand of its target market segment. The understanding that I have is that MH and FY are after different market segments.

This is a case of MH not following their own advice.

 

When they wanted to block D7, they used the excuse that MH and D7 should fly routes exclusively, so that they can complement each other. Fortunately, for most routes, the Malaysian authorities did not fall for this argument.

 

SQ/MI/TR have studied the market for their routes and have carved out their respective markets accordingly. It may be in MH's best interests to take heed of these techniques so that MH and FY does not cannibalise passengers from each other. This is what I meant by branding and/or product confusion. If you confuse the passengers, then they may not know which to choose and they may end up choosing a competitor's product/brand.

[N Azman 0]

 

Is it any surprise that analysts are better able to understand AirAsia group airlines better than MH's rojak pot?

 

Transparency and accountability. Its an airline bro. not a political party. MH owes its investors its own figures only and nothing more nothing less. FY figures don't need to be disclosed unless they go IPO. get over it.

 

 

MH is obviously not doing an OK job. Not after everyone knows that their Cost of Sales is higher than their RM 13 billion revenues and that the RM 200+ million net profit are gained through derivatives.

 

1) As mentioned in the earlier reply, AirAsia X Sdn. Bhd. is not part of AK group. It was never in AK's group level accounts because AK only owns 16% of its shares.

 

2) I am not suggesting a complete MH+AK or FY+AK on a certain route. Like the example I gave for SQ-MY-TR where all 3 airlines serve KUL-SIN vv, the issue I have is the non reduction of frequency of MH flights. It's like MH does not have any data at all about the demand of its FSC flight on that particular route. If MH has identified that it has an X amount of demand on KUL-KCH through 9 daily flights with average load factor of 65%, surely an addition of 4 FY flights on the route would decrease that X demand by a certain %. But this is not happening. As I mentioned, the domestic market is only growing by 3% in 2010 so the extra capacity will only further decrease MH and FY yield and load factor. My idea is that for this exhibit, MH should have maybe only 5 daily KUL-KCH flight and a new 4 flights with FY. That way, FY flights can achieve a healthy load factor while competing against the market that AK is in while the 5 MH flights are to cater for FSC passengers. That way, MH group of airlines can rake in optimum yield and load factor for all of its MH and FY flights. There are market for everyone. It's just that MH need to adjust its capacity based on demand of its target market segment.

 

3) Even SQ conducts sales sometimes to boost sales. But not in the way MH did in the past. SQ did not offer 0 fare/free seat flights on SIN-KUL vv just because AK did. Btw, SQ has an ongoing promotion of RM 454 all in return as we speak.

 

Me working for AK? If you care to click on the FlightMemory banner that follow all my 2,460 posts in this forum (and counting) [the blue banner next to the 3 EK girls at my siggy], you should be aware that I have never flown AK in my entire lifetime except for 2 flights with D7 and also, which airlines I flew the most. Any guess?

 

wrong. if cost of sales is higher than total revenue, then there wouldnt be any OPERATING profit. nevermind net profit as its affected by gains. But operating profit is pure profit. true it could be bigger, but hey, at least its not as bad as you and flee are painting.

 

1) Also, like i mentioned earlier, its up to MH completely to reveal or not to reveal FY's figures. its business strategy. thousands other industries do it also. mubadala does not disclose SR Technics and ADAT's financial figures....and i can go all night with examples.

 

2) OK so not total cancellation of either MH or FY, but its reduction of MH that you want. fair enough. although i still don't see how you come up with that conclusion without looking at route level PnL but i see where you're coming from. great deal of assumptions tho to say that.

 

3) So its ok for SQ or MH to do sales, but don't enroach on LCC territory of fares? where is the line drawn? 'roughly high or roughly low' or does it depend on how it sounds or what fonts were used in the ad? psshhh....

 

Saudi? duddeeeee. are u being blackmailed into flying them or you don't get your work permit renewed?

[flee 5]

Transparency and accountability. Its an airline bro. not a political party. MH owes its investors its own figures only and nothing more nothing less. FY figures don't need to be disclosed unless they go IPO. get over it.

If you need loans from banks and investors, then you need a certain amount of transparency and accountability. By your reasoning, MH can tell these people to go fly kites. Afterall, it can always get a taxpayer bailout if it encounters financial problems. And we will be looking at another BTP again.

[N Azman 0]

If you need loans from banks and investors, then you need a certain amount of transparency and accountability. By your reasoning, MH can tell these people to go fly kites. Afterall, it can always get a taxpayer bailout if it encounters financial problems. And we will be looking at another BTP again.

 

ahh the ol' taxpayer bailout statement. I was waiting for this one Somehow shooters lacking in creativity always brings up this subject. nevermind the turnaround they did and nevermind the healthy cash balance. MH will always be fools who will one day have to be saved by the taxpayers. and how BTP is about selling assets only and not about business turnaround. yawn. arm chair stuff.

 

MH transparency exists to the creditors, government and also shareholders which includes khazana and gomen arms. Just that that level of transparency is not needed for YOU. Even if you have MH shares, you only need to see MH level accounts and initiatives which is available in the annual report.

 

sigh, does this mean i have to go through and brief you thousands of examples of multi-national companies who do not reveal their associates PnL to public??? argghhh

[flee 5]

ahh the ol' taxpayer bailout statement. I was waiting for this one Somehow shooters lacking in creativity always brings up this subject. nevermind the turnaround they did and nevermind the healthy cash balance. MH will always be fools who will one day have to be saved by the taxpayers. and how BTP is about selling assets only and not about business turnaround. yawn. arm chair stuff.

 

MH transparency exists to the creditors, government and also shareholders which includes khazana and gomen arms. Just that that level of transparency is not needed for YOU. Even if you have MH shares, you only need to see MH level accounts and initiatives which is available in the annual report.

 

sigh, does this mean i have to go through and brief you thousands of examples of multi-national companies who do not reveal their associates PnL to public??? argghhh

If MH is so secretive, how come it is not doing so well compared to its real competitors? They will have super duper potent secret recipes that will easily kill off the competition, LCC or FSC, right?

[Mohd Azizul Ramli 2]

wrong. if cost of sales is higher than total revenue, then there wouldnt be any OPERATING profit. nevermind net profit as its affected by gains. But operating profit is pure profit. true it could be bigger, but hey, at least its not as bad as you and flee are painting.

 

1) Also, like i mentioned earlier, its up to MH completely to reveal or not to reveal FY's figures. its business strategy. thousands other industries do it also. mubadala does not disclose SR Technics and ADAT's financial figures....and i can go all night with examples.

 

2) OK so not total cancellation of either MH or FY, but its reduction of MH that you want. fair enough. although i still don't see how you come up with that conclusion without looking at route level PnL but i see where you're coming from. great deal of assumptions tho to say that.

 

3) So its ok for SQ or MH to do sales, but don't enroach on LCC territory of fares? where is the line drawn? 'roughly high or roughly low' or does it depend on how it sounds or what fonts were used in the ad? psshhh....

 

Saudi? duddeeeee. are u being blackmailed into flying them or you don't get your work permit renewed?

No, you are wrong. Quoting MH's financial statement:

 

Operating revenue 12,980,447

Operating expenses (13,323,737)

Other operating income 607,163

Profit/(Loss) from operations 263,873

MH recorded a loss of RM 343,290,000 in 2010 from the CORE operation.

 

1) I agree that it is MH's complete prerogative not to disclose FY's number because it is not requited by the Malaysian law. But only because of that, not because of business strategy. Logically, if FY has nothing bad to hide, it should flaunt its numbers, not in great details but at least trying to make the competitor stunts. D7 did that many times. But as I mentioned earlier, MH is a Malaysian GLC with proven slow management, we just don't want on one fine day BOOM!!! MH recoded 2 billion of net loss.

 

3) If MH knows its market segment and the profile of travelers that it should go after, the airline would be able to figure out how low it could go while doing a sales promotion, the same way SQ came out with that RM 454 price tag in their current KUL-SIN vv promo. Not came out with a 0 Fare/Free seat promotion just because AK did so. Surely an airline of MH caliber has a team of brains/think tanks to figure this out, isn't it?

 

Well, if MH fly on domestic routes in Saudi Arabia, then I would be very pleased to fly with them.

 

We have stumbled upon many of those who are pro MH in the past but no one is like you. Your spinning is admired. Take it as a compliment.

[N Azman 0]

If MH is so secretive, how come it is not doing so well compared to its real competitors? They will have super duper potent secret recipes that will easily kill off the competition, LCC or FSC, right?

 

Finally!! we have an agreement!! yes never doubted the fact that MH is not doing so well compared to its competitors SQ EK and so on. And we know it has got something to do with costs. Staff cost they can't do much as theyre burdened by the legacy workforce that can't be retrenched unlike their other competitors. So its up to fuel, maintenanc thru MRO synergies and service optimization.

 

And, get more money then! expand expand expand and regain market share. which is exactly what they are doing.

 

but who knows? we've seen FY launch jet services this year, new planes and new branding are coming in, social media is getting more creative with that facebook booking thingy, maybe alliance in the future? who knows what lies next? not me, but certainly not you either. Which is why i keep questioning your bullish statements and assumption driven thoughts about how they're gone case.

[c.lee 0]

2) I am not suggesting a complete MH+AK or FY+AK on a certain route. Like the example I gave for SQ-MY-TR where all 3 airlines serve KUL-SIN vv, the issue I have is the non reduction of frequency of MH flights. It's like MH does not have any data at all about the demand of its FSC flight on that particular route. If MH has identified that it has an X amount of demand on KUL-KCH through 9 daily flights with average load factor of 65%, surely an addition of 4 FY flights on the route would decrease that X demand by a certain %. But this is not happening. As I mentioned, the domestic market is only growing by 3% in 2010 so the extra capacity will only further decrease MH and FY yield and load factor. My idea is that for this exhibit, MH should have maybe only 5 daily KUL-KCH flight and a new 4 flights with FY. That way, FY flights can achieve a healthy load factor while competing against the market that AK is in while the 5 MH flights are to cater for FSC passengers. That way, MH group of airlines can rake in optimum yield and load factor for all of its MH and FY flights. There are market for everyone. It's just that MH need to adjust its capacity based on demand of its target market segment. The understanding that I have is that MH and FY are after different market segments.

There are 2 possibilities:

 

1) MH is adopting the wait-and-see strategy. MH needs some time to get some data of how much passengers are transferring from MH to FY for KUL-KCH and KUL-BKI vv, then only they will reduce frequency accordingly.

 

2) MH is hoping that FY 734/738 passengers will be 100% of those transferring from AK, hence AK will be the one reducing frequency, not MH.

 

If option 2 is indeed the case, good luck to MH then.

[N Azman 0]

No, you are wrong. Quoting MH's financial statement:

 

 

MH recorded a loss of RM 343,290,000 in 2010 from the CORE operation.

 

1) I agree that it is MH's complete prerogative not to disclose FY's number because it is not requited by the Malaysian law. But only because of that, not because of business strategy. Logically, if FY has nothing bad to hide, it should flaunt its numbers, not in great details but at least trying to make the competitor stunts. D7 did that many times. But as I mentioned earlier, MH is a Malaysian GLC with proven slow management, we just don't want on one fine day BOOM!!! MH recoded 2 billion of net loss.

 

3) If MH knows its market segment and the profile of travelers that it should go after, the airline would be able to figure out how low it could go while doing a sales promotion, the same way SQ came out with that RM 454 price tag in their current KUL-SIN vv promo. Not came out with a 0 Fare/Free seat promotion just because AK did so. Surely an airline of MH caliber has a team of brains/think tanks to figure this out, isn't it?

 

Well, if MH fly on domestic routes in Saudi Arabia, then I would be very pleased to fly with them.

 

We have stumbled upon many of those who are pro MH in the past but no one is like you. Your spinning is admired. Take it as a compliment.

 

Awww trying to be cheeky are we? no one indeed is like me, and that im quite sure of.

 

1) operating profit comes from all businesses including the core airline. Which is why ive been harping on synergies for a FSC since the uptenth post ago. so if they were to follow your advise and cut off growth of the subsidiaries, they'd be running a loss. good advise indeed.

 

2) So revealing the figures to joe public would protect MH from that RM 2 billion future loss. hmmm. you lost me there.

 

3) so you're convinced MH just plucks the low fare figures out of the air and not do a 'detailed market segment' like SQ and others? you're quite the MH insider! MH must be really doomed if theres a chess board in revenue management used to pluck fares for promos.

 

have you tried air arabia the LCC? heard they got the sky interior as well. don't know whats that all about.

[Lock SH 0]

We need Idris Jala back to do BTP3 for MH.

 

Sorry, there is nothing left for him to 'sell'.........

 

 

[N Azman 0]

There are 2 possibilities:

 

1) MH is adopting the wait-and-see strategy. MH needs some time to get some data of how much passengers are transferring from MH to FY for KUL-KCH and KUL-BKI vv, then only they will reduce frequency accordingly.

 

2) MH is hoping that FY 734/738 passengers will be 100% of those transferring from AK, hence AK will be the one reducing frequency, not MH.

 

If option 2 is indeed the case, good luck to MH then.

 

Finally, some good constructive inputs! actually, Both (1) and (2) would bode well for MH. a more focused market segment is the prize after both options. So lets see!

 

Sorry, there is nothing left for him to 'sell'.........

 

 

 

theres always something to sell!!! havent you heard of the oldest profession in the world?

[Mohd Azizul Ramli 2]

And, get more money then! expand expand expand and regain market share. which is exactly what they are doing.

But sadly in 2010, that is not happening. MH's domestic market shares in KLIA further decreased to only 42% in 2010 from 44% in 2009. I have no data of MH's international market shares but AK claimed to control 37% of the market share, which means MH is no longer a market leader.

 

1) operating profit comes from all businesses including the core airline. Which is why ive been harping on synergies for a FSC since the uptenth post ago. so if they were to follow your advise and cut off growth of the subsidiaries, they'd be running a loss. good advise indeed.

 

2) So revealing the figures to joe public would protect MH from that RM 2 billion future loss. hmmm. you lost me there.

 

3) so you're convinced MH just plucks the low fare figures out of the air and not do a 'detailed market segment' like SQ and others? you're quite the MH insider! MH must be really doomed if theres a chess board in revenue management used to pluck fares for promos.

 

have you tried air arabia the LCC? heard they got the sky interior as well. don't know whats that all about.

1) Then for your argument's sake, mind sharing the breakdown of that RM 607,163,000 of Other operating income just to be sure?

 

2) You made false sweeping conclusions all the time. Good luck with that.

 

3) So a 0 fare/free seat promotions which was offered after like 2 days AK did theirs is the result of a thorough and detailed studies by an entire department of brains/think tanks? We are talking about 0 revenue here. Sorry, I am not convinced.

 

For someone who spun the way you have been spinning, it is of utmost shock to find out that you are still confused with which airlines is based in the Kingdom of Saudi Arabia and which airlines is based in the United Arab Emirates. Air Arabia does not fly on domestic routes in Saudi Arabia, just like MH.