Thursday 28 Mar 2024
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KUALA LUMPUR (Dec 14): Malaysia Airlines Bhd, a wholly-owned subsidiary of Khazanah Nasional Bhd, expects to close the year with lower loss than 2017.

"We have seen good quarterly traction in the year and we are expecting to finish 2018 by reducing the losses of the previous year," its group chief executive officer Izham Ismail said in a statement today.

"Moving forward, 2019 looks similarly challenging but we remain committed to improving performance and reducing costs while managing external factors beyond our control,” he added.

Malaysia Airlines posted a wider net loss of RM812 million for the financial year ended Dec 31, 2017 (FY17) compared with RM439 million in FY16.

The national airline today announced that its third quarter operating performance was impacted by stiff competition, rising fuel prices and adverse foreign exchange (forex) movements, further exacerbated by crew shortages, especially in July and August.

Describing it as "challenging", the national airline saw passenger yield came under pressure to record 21.5 sen in 3Q 2018, down from 22.6 sen in 3Q 2017.

It attributed this to the inability to deploy planned peak upgrading of aircraft to a widebody during the period as a result of crew shortages, which had impacted revenue.

"The airline has since activated an extensive recruitment exercise, supported by an aggressive cadet enlistment and training programme to build a strong pipeline of crew and is confident that the situation will be stabilised by early 2019," it said.

Izham said the third quarter continued to be challenging with volatile fuel prices, unfavourable forex movements, as well as overcapacity in key markets compounded by the pilot shortage.

"We are maintaining a strong focus on cost management and will continue to invest in aspects of the customer experience that deliver a competitive edge," he noted.

Nevertheless, Malaysia Airlines recorded a marginal 1.4% rise in revenue average seat per kilometer (RASK) to 21.2 sen in 3Q 2018 from 20.9 sen in 3Q 2017. This was mainly driven by higher cargo revenue, up 29% year-on-year (y-o-y).

The airline carried 2.1% more passengers to 3.47 million in 3Q 2018 compared with 3.4 million a year ago.

Passenger load factors also increased 3% to 80.5% in 3Q 2018 from 77.5% a year ago.  Recovery in international business continued in the third quarter, with a load factor of 81.7% versus 78.4% in 3Q 2017, said Malaysia Airlines.  

On-time performance also increased during the quarter under review, up 8% to 74.9% in 3Q 2018 from 69.5% in 3Q 2017 as a result of improved operational efficiencies in engineering and ground handling.

In terms of customer experience after staff morale dipped to its lowest following the twin tragedies of MH370 and MH17 in 2014, Malaysia Airlines said it saw an overall improvement in customer satisfaction index, which was up 7% y-o-y, with the airline’s net promoter score increasing by a significant 21 points in the period.

Malaysia Airlines said this was, in part, driven by improvements to the airline’s call centre which introduced an ‘after-call survey’ to obtain immediate customer feedback. Call centre satisfaction ratings are up 7% to 74%.

During the quarter under review, the airline added its sixth Airbus A330-200 to its fleet of 21 A330s deployed on routes across Asia-Pacific. The B737-800s, meanwhile, continue to provide domestic and regional connectivity while the airline prepares for delivery of 10 737 MAX8 in 2020.

Malaysia Airlines’ six A380-800 super jumbos continue to service Project Amal, a division within the airline dedicated to Hajj and Umrah traffic. The A380s are also deployed to key markets such as Sydney and Seoul during peak times.


 

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