MAS posts RM 527 Million Loss in Q2, Doesn’t Expect Profit for 2011

[flee 5]

The Star's analysis of Q2 results

[leon t 0]

sad and dont know how much billion losses MH will ened up with in its full-year accounts - and if add in all the previous bail-outs n losses - should be well over rm6 billion in debts/losses or more!

[alberttky 0]

sad and dont know how much billion losses MH will ened up with in its full-year accounts - and if add in all the previous bail-outs n losses - should be well over rm6 billion in debts/losses or more!

 

Taxpayers' money thrown in to rescue airline run by incompetent management...

[jit 0]

Even if MAS is allowed to shut down and a new airline started from scratch, it will not solve the core problem.. In many ways, MAS is just a reflection of what is wrong with

Malaysia.

 

Many GLCs get away with incompetency simply because they monopolize the economy in Malaysia.. can you name one GLC which is doing well and is competing on an

equal footing in the global open economy? Malaysian banks that are reporting hefty profits are protected in many ways..eg.. foreign banks are even limited by the number

of ATMs they are allowed to operate!!

 

MAS is perhaps the only GLC that has to compete on an equal footing with the rest of the world...

Edited August 24, 2011 by jit

[Mike P 0]

Even if MAS is allowed to shut down and a new airline started from scratch, it will not solve the core problem.. In many ways, MAS is just a reflection of what is wrong with

Malaysia.

 

Many GLCs get away with incompetency simply because they monopolize the economy in Malaysia.. can you name one GLC which is doing well and is competing on an

equal footing in the global open economy? Malaysian banks that are reporting hefty profits are protected in many ways..eg.. foreign banks are even limited by the number

of ATMs they are allowed to operate!!

 

MAS is perhaps the only GLC that has to compete on an equal footing with the rest of the world...

 

Nop, TM also has to compete with other competitors like Digi, Celcom, Maxis, Time, etc. It has been liberalised, and under Malaysian Government's instruction, TM, who owns Malaysia's backbone network, has to sell the infra and network to this Telco operators, as well as other foreign telco operators under wholesale prices.

[Josh T 0]

The Star's analysis of Q2 results

 

“The management team shall have a serious review of its current network moving forward, and shall adjust deployed capacity accordingly. MAS is currently executing the return of two B747-200 freighters, one B747-400 and three B737-400s by end-September 2011. MAS will continue to enhance its yield performance through successful front-end business class initiatives, implementation of fuel surcharges and step up its yield/revenue management,” it said.

 

Er...this is what they should have been doing ages ago rather than competing against a LCC! Promote the front-end services with reasonable sales! It definitely attracts travellers like me! 1 business class passenger is worth 4-5 economy passengers.

[Lock SH 0]

Taxpayers' money thrown in to rescue airline run by incompetent management...

 

Not really incompetent management rather the act of 'hand of God'......... MAS could be run by Tim Clark (EK boss) or Tony Tyler (ex-CX boss) or PM's bro (CIMB boss) ........ there is nothing could be done as long as the govt keep 'remotely controlled' the running of the airline itself. lob-sided contracts given to cronies which run for decades, appointment of deadwoods to be top managers, lack of optimisation of human and infrastructure resources are among the biggest holes created to sink the airline itself.

 

No matter how much effort is put to generate revenue, as long as the holes are not plugged, MAS will keep 'submerging' ........ as of now, MAS is already at the ocean floor, in the Chapter 11, gone, history, vanished but cronies keep pumping the money out of the skeleton, the bone marrow itself ......

 

Even TR was pardoned by our beloved Kerajaan Barisan Nasional ......

Pride of the nation? .......... we lost that many suns ago ...........

 

 

[Mike P 0]

Not really incompetent management rather the act of 'hand of God'......... MAS could be run by Tim Clark (EK boss) or Tony Tyler (ex-CX boss) or PM's bro (CIMB boss) ........ there is nothing could be done as long as the govt keep 'remotely controlled' the running of the airline itself. lob-sided contracts given to cronies which run for decades, appointment of deadwoods to be top managers, lack of optimisation of human and infrastructure resources are among the biggest holes created to sink the airline itself.

 

No matter how much effort is put to generate revenue, as long as the holes are not plugged, MAS will keep 'submerging' ........ as of now, MAS is already at the ocean floor, in the Chapter 11, gone, history, vanished but cronies keep pumping the money out of the skeleton, the bone marrow itself ......

 

Even TR was pardoned by our beloved Kerajaan Barisan Nasional ......

Pride of the nation? .......... we lost that many suns ago ...........

 

 

 

Even if they think GLC's CEO should not be appointed by outsiders, we still have some capable leaders. Like Idris Jala, he has really done a good job!

[MUHAMMAD SHAHIR SAYYID 0]

MAS 2nd Quarter Report:

 

http://malaysiaairlines.listedcompany.com/news.html/id/266266

 

From: http://malaysiaairlines.listedcompany.com/news.html/id/266213

 

Malaysia Airlines Announces RM527 Million Net Loss For Second Quarter 2011

 

Higher Fuel Costs overtake increased passenger revenue and yields

 

Aug 23, 2011

 

23 August 2011, Subang. Malaysia Airlines’ Group today announced a net loss of RM527 million for the second quarter 2011 (2Q2011), impacted by higher fuel costs that offset yield and Revenue Available Seat Kilometer (RASK), higher than the same quarter for 2010 (2Q2010).

 

The Group’s total revenues for 2Q2011 increased to RM 3.485 billion, 8% more than 2Q2010 (RM3.213 billion), while passenger revenue registered a 9% growth of RM2.086 billion, compared to RM1.912 billion for 2Q2010.

 

The airline’s aggressive and consistent cost control measures also yielded positive results, with a 2% reduction in non-fuel related expenses for 2Q2011, compared to the same quarter for 2010.

 

Fuel costs, however, continued to have the greatest impact to the group’s operations, increasing by 41% from RM1.102 billion for 2Q2010, to RM1.550b for 2Q2011.

 

The Board of Malaysia Airlines does not anticipate to make a profit for the 2nd half of 2011, although the anticipated losses will not be as severe as the first half of 2011.

 

Moving forward

 

The Board has identified immediate priorities to focus on in the short term. Firstly, the Board will focus on putting in place strong leadership to steer MAS, and are proactively looking to fill the MD/CEO and key senior management positions. Working with the new Executive Committee (‘EXCO’) formed two weeks ago, recovery initiatives will be implemented to turn the company’s fortunes around and to start rebuilding cash reserves. Immediate initiatives will include, amongst others, better capacity management; the implementation of dynamic pricing to improve yields and revenues; a review of products and brand positioning; and a review of Firefly’s business to focus on its turbo-prop operations out of Subang and to realign the Firefly jet business to focus on providing regional premium services. For the longer term, the EXCO will look into establishing a strategic plan to chart the airline’s course back to sustainable profitability.

 

As a result of the Collaboration Agreement signed by Malaysian Airline System Berhad and AirAsia Berhad and AirAsia X Sdn Bhd. A Joint Collaboration Committee (‘JCC’) was formed on 9 August 2011, to look into key areas for collaboration to realise synergies and cost efforts.

 

The JCC shall deliver more detailed terms of the collaboration, manifested in separate detailed agreements, whilst ensuring full compliance with anti-trust regulations. This will also contribute to shape the medium and long term direction of the company.

 

MAS will continue with its re-fleeting exercise to strengthen its competitive edge by further enhancing its product and services. The multi-year fleet renewal programme has commenced with the delivery of five new B737-800 aircraft and five new A330- 300 aircraft as at mid August 2011. The first new A330 freighter will be delivered in September 2011. There will be six more aircraft deliveries in 2011 (two B737-800, two A330 Freighters and two ATR72). Beyond 2011, MAS has a firm order of thirtyeight B737-800s, ten A330s, six A380s and two A330 Freighters. The aircraft delivery will gather pace in the next few years. The financing activities for 2012 deliveries have commenced in earnest.

 

For remaining of the year, IATA reported that the outlook of the airline industry remains bearish with fuel prices remaining high, fears of sovereign debt crisis in Europe and the possibility of a recessionary outlook for the United States. MAS current forward booking profile indicates key challenges for the Europe, US and Japan regions, with normal forward booking trend for other major regional destinations.

 

Issued by:

Media Relations Unit/Communications Division, Malaysia Airlines, Subang

 

--------------------------------------------------------------------------------

For media enquiries, please contact:

 

Anbarasu.S

Email : anbarasu.sundram@malaysiaairlines.com

Phone : 03 78404485

Mobile : 019 2224952

Edited August 24, 2011 by MUHAMMAD SHAHIR SAYYID

[Raymund Yeoh 1]

MAS 2nd Quarter Report:

 

http://malaysiaairli....html/id/266266

 

From: http://malaysiaairli....html/id/266213

 

Malaysia Airlines Announces RM527 Million Net Loss For Second Quarter 2011

 

Higher Fuel Costs overtake increased passenger revenue and yields

 

Aug 23, 2011

 

 

No mention about the future of MH in OW and its partnership with QF on setting up the so-called premium airline in KUL.....

[kandiah k 0]

I agree that the culture in MH has made it almost impossible to grow and change is scarce. Now with AK and MH in some sort of collaboration, hopefully MH can benefit from the dynamic approach of AK and return to sustainable profitability. I have personally come across so many corrupt staff in MH, offering various services to checking in passengers. Had I not been alert or if I was not a Malaysian, I would have easily fallen for all those traps and would have contributed to the ruin of our national carrier. Perhaps what is being done now (delaying the A380s and etc) may be a safer measure after all in the long run, although I do not agree with the delay in joining the OW alliance. Hopefully a big change can be made and the g'ment accepts challenges from competitors to ensure that MH is always sustainable and independent from any interference of any sort. I would also think that the front end of the long hauls should be strictly revenue or loyalty based customers and not because I know so and so or I am from this and that department. That certainly needs to change or else we would be talking about this topic again next year, the year after that and until it becomes a necessity to have an anniversary for it. There should also be a KPI for each staff and an appraisal is a definite to ensure that the staff grows forward with the company. I think IJ did a wise thing to sell off those unnecessary assets because I don't see anything significant (remind me if I have forgotten) that was done by any of the airline's top decision makers that seem wise and cost effective for the national carrier. We have to loose the pride by shedding off many routes which only serve as pride and continue to damage the bank balance of MH. If it means getting rid of the B744 immediately, then so be it, and if it means cutting routes and reducing frequencies, then so be it if it can assure good yields. Routes like LAX, EZE, CDG, FRA, AKL, DXB and BNE should go if they have to and domestic routes can see a reduction in capacity if it only sustains a smaller aircraft (ATR's) with better utilization. Places like KUA (Kuantan) will see better frequencies with the ATR's instead of a pathetic 3 daily flights using a B734. Making more sense with connection between East Malaysia and the East Coast of the Peninsular perhaps; BKI/KCH-KBR/KUA/TGG ?

 

Just my few cents worth for a better national carrier

[Isaac 0]

as of now, MAS is already at the ocean floor, in the Chapter 11, gone, history, vanished but cronies keep pumping the money out of the skeleton, the bone marrow itself ......

Chapter 11 is not the end, chapter 7 is but we do not have chapter 11 in Malaysia. It's either you are not bankrupt or bankrupt

[Isaac 0]

No mention about the future of MH in OW and its partnership with QF on setting up the so-called premium airline in KUL.....

QF has not announced where the soon to be set up premium airline is going to be based...

[Mike P 0]

I suppose TF has to twist his mind a little more to salvage MH. His mind has always been low cost all these while but how to maintain low cost yet still able to provide luxurious and premium service? That;s something new and challenging.

[flee 5]

That is why he mentioned that the new MH CEO should be someone from outside the aviation industry. Someone with new ideas, someone who understands numbers, marketing, etc. Someone who is a bit like D7's CEO, Azran Osman Rani!

 

So you can expect to see a new face at the helm of MH.

[Raj 0]

It was already expected for them to make a loss however now there is just one think we can look forward to, with this so called new managements, new CEO/MD etc, lets see what steps are they going to take to improve things. It would actually be good to compare some statistics from Q1 and Q2 with Q3 and Q4.

[Mohd Suhaimi Fariz 2]

That is why he mentioned that the new MH CEO should be someone from outside the aviation industry. Someone with new ideas, someone who understands numbers, marketing, etc. Someone who is a bit like D7's CEO, Azran Osman Rani!

 

So you can expect to see a new face at the helm of MH.

 

Last CEO was not from the aviation industry, and there were cries that the next one should be from the aviation industry <_ .>

 

I know, why not have the Management Trainees take a crack at running the airline. Certainly they can't do much worse than the more "experienced" management.

Edited August 24, 2011 by Mohd Suhaimi Fariz

[BC Tam 2]

..... we can look forward to, with this so called new managements, new CEO/MD etc, lets see what steps are they going to take to improve things .....

After witnessing so many of these boom/bust cycles and the inevitable new brooms' rallying cries for improvement, changes etc, I reckon some degree of cynicism can be justified

[markiemark 0]

As long as a lot of the same people remain as MAS, there will never be any change. A lot of people simply don't care about improving MAS and be more efficient.

Furthermore MAS has too much overhead costs and they can do with a whole lot people less.

 

There needs to be an attitude change, before MAS can change for the better..

[BC Tam 2]

The older ones amongst us will recall that 'loss making domestic routes' and 'social obligation' were the staple of the finger pointers during the earlier crisisses afflicting MAS

In particular, intra-Borneo rural air services was singled out as the most incurable illness of all, draining life out of our (beloved) flag carrier

Nowadays, some mechanism by which taxpayers' money is being chanelled to compensate MAS (well, MASwings to be precise) for these benevolent losses have now been made public knowledge. Hence (understandably) the focus of MAS' ills have shifted to low yield 'international routes'

But the tide of red ink from MAS persists. Even adjusted for inflation, I reckon the current losses are some quantum bigger than what was suffered all those years ago

So, what gives ?

[alberttky 0]

As long as a lot of the same people remain as MAS, there will never be any change. A lot of people simply don't care about improving MAS and be more efficient.

Furthermore MAS has too much overhead costs and they can do with a whole lot people less.

 

There needs to be an attitude change, before MAS can change for the better..

 

That's why I said it's better to fold the damn thing up and restart.

[Pieter C. 5]

Let MH goes bust and reform/reestablish a new airline with the current employees of MH....looks at Swiss today....

 

Swiss staff numbers are a fraction of the old Swissair...

Brussels Airlines staff numbers are a fraction of the old SABENA...

'new'Alitalia staff numbers are a fraction of the 'old'Alitalia...

MH has currently 19000 staff ? Given the number of aircraft and routes, I believe that number is way to high (my 2 cents); they should all be sacked and given the chance to apply for the 'new' resurrected MAS to a max of (let's say) 9500-10000, based on competence and new salary-scales and not based on crownies/'wheelbarrows'...just look how much you can save here on the yearly basis...

[Raymund Yeoh 1]

Swiss staff numbers are a fraction of the old Swissair...

Brussels Airlines staff numbers are a fraction of the old SABENA...

'new'Alitalia staff numbers are a fraction of the 'old'Alitalia...

MH has currently 19000 staff ? Given the number of aircraft and routes, I believe that number is way to high (my 2 cents); they should all be sacked and given the chance to apply for the 'new' resurrected MAS to a max of (let's say) 9500-10000, based on competence and new salary-scales and not based on crownies/'wheelbarrows'...just look how much you can save here on the yearly basis...

 

 

Pieter, if they do what you mention above....we will see a London style riots happening in M'sia.....unless there is a change of gment in M'sia I dont see this happening.....although this is what it should be if they revamp

[BC Tam 2]

MH has currently 19000 staff ? Given the number of aircraft and routes, I believe that number is way to high (my 2 cents); they should all be sacked and given the chance to apply for the 'new' resurrected MAS to a max of (let's say) 9500-10000, based on competence and new salary-scales and not based on crownies/'wheelbarrows'...just look how much you can save here on the yearly basis...

Bear in mind those are 19,000 voters (ok, perhaps minus the expat numbers) and you'll begin to understand why it isn't such a viable option as long as Malaysian govt retain that one golden share in MH

[BC Tam 2]

.....unless there is a change of gment in M'sia I dont see this happening.....

I don't see this happening even if there is a change of govt in Malaysia to be honest

Those aspiring gahmen people are neither novices, naive nor suicidal as far as we can tell so far

(ok, one has been declared suicidal but then .......)