Well,well....what a nice surpirise.......MAS made a profit......
Attached below is a report from the Star newspaper.
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MAS returns to profit with RM5m Q2 pre-tax
By B.K. SIDHU
FOR the first time in five years, Malaysia Airlines (MAS) has reported its first profitable quarter with a modest pre-tax profit of RM4.9mil for the second quarter ending Sept 30, 2002.
The return to profitability came from improvements in cost control and better passenger and cargo loads, as well as to the various turnaround programmes the company had initiated the past 18 months.
However, on a cumulative basis, the airline still recorded a pre-tax loss, although narrowed to RM72mil for the first six months of financial year (FY) ended March 31, 2003, compared with RM557mil reported in the previous corresponding period.
Revenue rose to RM2.3bil for the second quarter ended Sept 30 compared with RM2.1bil reported a year earlier. For the first six months, revenue was RM4.5bil compared with RM4.2bil.
Net profit for the second quarter was RM1.1mil. However, for the first 6 months, the company reported a net loss of RM79mil compared with a net loss of RM557mil a year earlier.
Earnings per share for the second quarter was 0.15 sen. For the first 6 months, MAS reported loss per share of 10.35 sen.
“This is the first time we are reporting a profit after being in (a loss) situation for so long. It is huge step forward although the numbers may be modest,’’ MAS managing director Datuk Md Nor Yusof told reporters when announcing the company results yesterday, adding that revenue and load factors were above pre-Sept 11 levels.
MAS has also projected a return to profitability in FY2003 with pre-tax profit of RM94.2mil and earnings per share of 9.3 sen.
Md Nor said the airline would also retain its full year projections although some had said they were “conservative figures.’’ The second quarter results, however, had beaten some analyst’s estimates.
Turning to the growth for second quarter, he said it was organic and the recovery was 60% revenue-led, supported by traffic growth and yield improvements.
The higher yielding sectors were the Orient, South Asia and Asean regions. In the pipeline are plans for additional frequencies to destinations such as Beijing, Shanghai, New Dehli, Mumbai, Guangzhou, Xiamen, Hong Kong, Vietnam, Yangon, and Osaka.
On the overall, passenger yield was at 18.80 sen per passenger km (s/pkm); international at 17.44 s/pkm; and domestic at 29.11 s/pkm.
MAS has been emphasising the need to improve yields and according to Md Nor, “every one sen improvement in its yield will result in a RM300mil increase in sales.’’ To better manage yields, a new revenue and inventory management system has been installed.
MAS’ revenue passenger km (RPK) traffic rose 3.9% year-on-year for the second quarter to 10,027 million passengers km while cargo traffic jumped 16.8% year-on-year from the same period to 521 million load tonne km. Passenger and load factor averaged 73.5% and 68.3% respectively for the quarter, which represents increases of 2.5% and 11% respectively.
Asked whether MAS would be able to compete with existing airlines serving the Asian routes, Md Nor said: “For sometime now, Singapore has been eating our lunch ... but it is our fault because we have been busy concentrating on being a global airline.’’ Its focus ahead is the region.
He said Singapore had 2.5% more frequency to China than MAS and many Malaysians were flying to China via Singapore. But in the coming months, MAS would deploy more capacities to destinations within China and India, apart from the Asean region. It also has plans to expand into West Asia, North America and South Africa.
The carrier is also in the midst of finalising the cost for the refurbishment of 24 (15-B777 and 9-A330) aircraft used for short haul destinations. The aim is to convert them into two classes of seats, business and economy, and provide sleepers for aircraft flying long haul. Md Nor did not commit to a figure on the refurhishment cost. Financing for the refurbishment exercise is no longer an issue since the airline has about RM670mil in its coffers.
Last week, MAS obtained shareholders’ approval for its restructuring and turnaround programme whereby its parent company Penerbangan Malaysia Bhd (PMB) would end up with a 69% stake in MAS, its aircraft fleet and take over RM8.9bil debts.
MAS would lease aircraft from PMB to operate and manage the international routes. It would also operate the domestic operations at a fee from the government.
Md Nor said MAS would save about RM200mil to RM300mil in costs annually from sale and leasing aircraft and the savings for the year to March will be accounted for proportionately, beginning November.
On the domestic operations, Md Nor said the government would decide on its business model, however, it was unlikely to become a low-cost carrier as it was currently a premier and market-oriented airline.
He also denied that MAS had suffered losses in its domestic operations, which had always gained economic returns.
On its cargo operations, he said that MAS was excited over the prospects of transhipment cargo, an area it would develop further.
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To all the naysayers & the detractors all I can say is let's wait & see!
PILOST