MAS Suffers Pre-Tax Loss Of RM238.25 Million In Q1

[flee 5]

PETALING JAYA, May 25 (Bernama) -- Fuel hike and a stronger ringgit led the national carrier, Malaysia Airlines Bhd (MAS) to post a pre-tax loss of RM238.25 million for the first quarter ended March 31, 2011 compared with a pre-tax profit of RM320.25 million chalked up in the corresponding period last year.

 

Revenue decreased to RM3.19 billion, during the period under review, from RM3.30 billion, previously.

 

"Passenger revenue growth, outstripped by the steep increase in fuel prices and the strengthening ringgit, impacted Malaysia Airlines' first quarter performance for this year," Managing Director and Chief Executive Officer, Tengku Datuk Seri Azmil Zahruddin said.

 

He said operationally, in comparison for the same quarter for 2010, the national carrier recorded marked improvement in key aspects of its core business, with a 10 per cent increase in traffic, leading to an improved passenger load factor of 76 per cent.

 

"This has resulted in an overall 10 per cent increase in passenger revenue and includes a significant positive contribution from the high-end business, which registered a revenue increase of 40 per cent," he added.

 

The non-fuel unit cost downtrend was rigorously maintained and a reduction of six per cent, over first quarter 2010, was recorded for this period.

 

Media Release

 

MAS Presentation

 

Bursa Announcement

[KK Lee 5]

What a surprise Q1 result, derivative gain was not sufficient to offset operating loss

[Raymund Yeoh 1]

Our neighbour down south and up north posted profits .....

[Isaac 0]

Our neighbour down south and up north posted profits .....

Malaysia Airlines - Memang Lain Daripada Yang Lain

[KK Lee 5]

Given high fuel price impact intercontinental routes more than regional, most MH intercontinental is served by 772 and these routes are mostly low yield or low load or both. How MH plan to remedy?

 

If MH and FY 738 delivery is according to plan, there will be significant increased in regional ASK and overlapped routes. What is MH strategy to fill these seats?

Edited May 25, 2011 by KK Lee

[JuliusWong 0]

MH needs to get the life support machine ready, just in case~~~ <_>

[Lock SH 0]

It had been light years ago on the life support machine anyway .........

 

Please tell me something new about MAS ......

 

 

[Josh T 0]

Disappointing result given that almost everyone around them are still posting profits. Fuel costs being so significant in their results, and being such a major factor over the last few years, they really should be making a decision about replacing the B772 and getting rid of the B734 as soon as possible. Thank goodness the fuel-guzzling B744 will be pretty much replaced by the end of next year with the A380.

What's encouraging is that they're focusing on improving front-end performance. This is where SQ and EK make most of their money. 1 business class passenger makes the same amount of money as 5-6 economy class passengers. Hopefully, we won't see worse results in Q2. <_>

[Johan Z 0]

So far away from being Asia's no. 1.

[KK Lee 5]

What's encouraging is that they're focusing on improving front-end performance. This is where SQ and EK make most of their money. 1 business class passenger makes the same amount of money as 5-6 economy class passengers.

 

MH had similar exercise a couple of years ago but fizzled out after a while

Edited May 26, 2011 by KK Lee

[Kee Hooi Yen 0]

So far away from being Asia's no. 1.

 

soon no longer Malaysia's no 1

[leon t 0]

nothing surprising as even when MH makes some profits; its just a a paltry sum compared to the likes of SQ or even CX; and that were mainly from selling of its assets n planes.

MH can put the "blame" on high fuel costs etc - but really this does not hold bec of the factthat SQ n CX n even TG can make millions in profits and these airlines pay the same fuel costs as MH does. Some can blame on MH's aeging aircrafts - but then again these aircrafts have been written off its value and theoretically its "chape" to use these planes. However even as MH cant make a cent; it will be worse when its A380s arrives - as its a whole lot bigger plane and still somehow MH dont have that much pax capacity to fill these jumbos without resorting to even bigger discounts which will make their yields worse. MH needs a total new management from outside MH n revamp from ground up.

[Johan Z 0]

MH blames fuel cost for the loss, why don't they order new aircraft which are more fuel efficient, like 77W to replace 747? 747s are not that young either.

Demand for international travels has picked up, as claimed by SQ. MH also recorded passenger growth, the only one to blame is really the airline management.

[flee 5]

Old aircraft don't make a difference if MH does not own them. If they are leasing, then they still have to make lease payments, no matter if the aircraft is old or new.

 

B747s will be replaced by A380s next year. So that may improve the situation somewhat. B772s will be used for thin long haul routes. A333s/B738s will be used for regional routes.

 

Yes, MH's reasons for making losses are not unique and all airlines had to contend with these factors of high fuel prices and strong RM. AirAsia even made RM200+m pre tax profits despite having revenue that is less than one third of MH's.

 

SQ/CX also made profits. So MH is losing out to all competitors. Bottom line is - IT IS NOT GOOD ENOUGH!

Edited May 26, 2011 by flee

[Raymund Yeoh 1]

I think the gomen really need to seriously think and ask where they want to take MH too in the near future.....to beat the likes of SQ,CX or to beat the likes of AK, D7.....also, I think the current management should be changed to those who really knows how to manage an airline....I think the current one is still not doing its job well

 

Take for exp CX, almost the whole management is foreigners and at least 1/2 of the air crew are also foreigners.....n they are still making tons of money....I fly CX every month for work (usually PEN-HKG-TPE route) n all I can say almost every flight is full to the brim.......n the service I get from CX (in my opinion) is much better from MH......

[flee 5]

KUALA LUMPUR, May 26 (Bernama) -- MIDF Research has downgraded Malaysia Airlines to a "sell" and reduced its target price to RM1.24, from RM2.40 previously, as its expects the airlines' second quarter to be impinged.

 

Factors affecting the downgrade are the limited implied upside potential, pressure from escalating fuel prices, impact from the Middle East and North Africa civil unrest and the natural disaster in Japan, MIDF said in a note on Thursday.

 

The research firm has also decreased its earnings forecast for financial year 2011 and 2012, between 31 and 58 per cent, to reflect the lower-than-expected first quarter earnings and rising fuel prices.

 

"On top of that, the management is planning new revenue management system to be rolled out in the third quarter to improve pricing methodology and revenue.

 

"Hence, we remain upbeat on its long-term prospects," it added.

[jackch747 0]

I'm not surprised.

 

Based on the products they offer, they deserve this.

 

"MAS is a confused puppy"

[Raj 0]

Take for exp CX, almost the whole management is foreigners and at least 1/2 of the air crew are also foreigners

 

Whether the MH management is Foreigners or Locals do not matter. Aviation is a Business that only people with years of experience can manage and understand it. What MH needs to do is revamp its Management with people who have years of experience in the Aviation sector. The only way I see this happening if it is privatised and sold of to a private company or firm or whatever. As long as the government is involved, expect any Tom, Dick or Harry to likely succeed one another for the top post. Just my point of view.

[flee 5]

Agree - SQ is managed by locals (and Malaysians) and they are not doing too badly, are they?

[Ikman Ikreza 0]

Try to make a booking on MH, now I saw tax for domestic now increased by RM10 to RM25 one way. Last week while try make a booking tax only RM15. That's mean fuel surcharge now applied?

[kandiah k 0]

Agree - SQ is managed by locals (and Malaysians) and they are not doing too badly, are they?

 

 

Perhaps they :

 

1)have a policy to allow the company to grow at their own expense

2)have a proper and transparent business plan

3)have no interference from any higher authorities

4)have no special privileges or protection

 

and that is why they are where they are today (although I don't think highly of their cabin crew service)

 

If only MH is cut off from all these, then we can see the light for MH

[Edwin P K 0]

 

[Raymund Yeoh 1]

 

 

My my...i'm suprised the share still have earnings.....can someone tell what does PE (X) means

[Mike P 0]

The load factor is quite good, really don't understand why they still loss money...

[JuliusWong 0]

The load factor is quite good, really don't understand why they still loss money...

 

Most probably selling tickets at cheap prices that are not enough to cover the cost of goods sold.