KUALA LUMPUR (Feb 27): Brahim’s Holdings Bhd swung into a net loss of RM40.32 million or 17.06 sen a share in its fourth quarter ended Dec 31, 2014 (4QFY14), from a net profit of RM12.69 million a year ago, mainly affected by weaker performance from its in-flight catering business.

Besides, the group also provided RM8 million in allowance for impairment loss, on goodwill of its 60%-owned subsidiary, Admuda Sdn. Bhd.

Revenue fell 27.5% to RM79.07 million, from RM109.12 million previously.

In a filing with Bursa Malaysia, Brahim’s (fundamental: 0.8; valuation: 1.8) said the losses resulted largely from “concessions” amounting to RM56.08 million given by its 70%-owned subsidiary Brahim’s Airline Catering Sdn Bhd to Malaysian Airlines, under the latter’s recovery plan.

For the full year, Brahim’s posted a net loss of RM33.59 million or 14.34 sen a share, compared to a net profit of RM22.03 million in FY13. Revenue meanwhile, dropped 10.45% to RM353.57 million, from RM394.83 million a year ago.

Brahim’s said the outlook for the in-flight catering segment continues to remain challenging, despite the expected increase in passenger load in first half of 2015.

“The meals volume and revenue from Malaysia Airlines System Bhd (MAS) is expected to be consistent with the previous period. However, the profit margin from flight catering and cabin handling may be affected, due to the implementation of new pricing methodology in the new catering agreement currently under negotiations.

“Nevertheless, revenue from foreign airlines is expected to improve, arising from new airlines clients in 2015.” it added.

Brahim's closed at RM1.31, up 2 sen or 1.55%, giving it a market capitalisation of RM309.53 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations)