KUALA LUMPUR (Feb 28): Higher cost dragged Malaysia Airports Holdings Bhd's (MAHB) net profit down 12.9% to RM28.1 million in the fourth quarter ended Dec 31, 2018 (4QFY18), from RM32.28 million a year ago.

MAHB, which manages and operates 39 airports in Malaysia, said cost increased by 3.4% year-on-year (y-o-y) in 4QFY18, mainly due to provision of doubtful debts, higher amortisation and depreciation, utilities, as well as repair and maintenance cost.

The airport operator reported a loss per share of 0.05 sen for 4QFY18 compared with an earnings per share of 0.2 sen for 4QFY17.

Quarterly revenue grew by a marginal 0.4% y-o-y to RM1.25 billion.

Nevertheless, the group proposed a final dividend of 9 sen per share for the financial year ended Dec 31, 2018 (FY18), subject to the approval of shareholders at the forthcoming annual general meeting. This brings total dividends for the year to 14 sen per share.

Despite the weak quarterly performance, MAHB tripled its net profit to post a record RM727.3 million for full FY18 from RM239.76 million in the previous year, which it attributed to sustained growth in passenger and aircraft movements.

The group also recorded an unrealised gain on the fair value of investment in GMR Hyderabad International Airport Ltd (GHIAL) amounting to RM258.4 million in FY18. MAHB holds an 11% stake in GHIAL.

Revenue rose 4.3% to RM4.85 billion – its highest-ever – from RM4.65 billion in FY17.

"Overall, Malaysia operations recorded a revenue of RM3.55 billion with growth of 3.5% y-o-y in FY18, while Turkey and Qatar operations recorded revenue growth of 6.3% to RM1.15 billion and 8.4% to RM149.1 million," said MAHB.

On prospects, MAHB said the Malaysia passenger traffic in 2019 is expected to grow by 4.9% with international and domestic passenger traffics growing at 2.4% and 7.6% respectively, based on prevailing economic conditions and the airlines seat capacity offered.

While fuel price (Brent crude) has come down by 30% and is expected to remain relatively low for 2019, MAHB said the traffic growth is expected to remain vulnerable with significant changes in the macro-economic environment despite the expected lower fuel price.

Meanwhile, the passenger growth prospect for the Istanbul Sabiha Gokcen International Airport in Turkey in 2019 is expected to be moderate at 4.3% this year, with the international and domestic passenger traffics anticipated to grow by 5.2% and 3.8% respectively.

MAHB said the group’s FY19 earnings before interest, taxes, depreciation and amortisation (Ebitda) key performance indicator target for its Malaysia operations is RM1.21 billion, which was what it had achieved in FY18.

Shares of MAHB closed down two sen or 0.24% at RM8.17 today, with 4.64 million shares done, bringing its market capitalisation to RM13.56 billion.