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Malaysia Airlines to start making profit next year

MH-A380

Syndicated News
Written by Syndicated News

SEPANG — July 10, 2017: Malaysia Airlines Berhad (MAB) is expected to start making profit next year.

This was informed to Prime Minister Datuk Seri Najib Razak by MAB Chief Executive Officer Peter Bellew today.

The first stage (restructuring of Malaysia Airlines) focused on stabilising MAB’s finances and that has been achieved.

“In my discussions with Bellew, he said he expects MAB to be in the black hopefully next year,” said Najib at the Malaysia Aviation Group’s Hari Raya celebration here.

Najib said the focus now is on the second phase, involving new routes, including 11 routes to and from China.

This phase will also look at product depreciation aspects such as in-flight cuisine, flight entertainment and the quality of an aircraft.

“Today, I was told that you are well on your way to achieving the second phase of revival for MAB,” he said.

With these measures, Najib said, Malaysia Airlines will be able to regain the Skytrax five-star rating by next year.

According to him, when the decision was made to restructure the national carrier involving a reduction of about 6,000 workers, he had instructed Khazanah Nasional to be as humane as possible.

At the event, Najib also called on every MAB officer to continue to be dedicated and committed to the success of the company.

“As far as I’m concern and many Malaysians, we do not look at MAB as just an ordinary airlines. MAB is about the nation, it’s our icon, our pride and joy. We must make sure Malaysia Airlines will recover and become one of the leading airlines,” he said.

In conjunction with the event, Najib also launched Negara-Ku livery on the Malaysia Airlines’  B737-800 aircraft.

The B737 aircraft, the first of several to display the national flag, will be flown and be made visible across international flights below seven hours, such as to Shanghai and Perth.

According to Bellew, the expansion of new routes to China, India and North Asia, which is expected to happen in the second half of the financial year ending December 31 next year, will be the key to the turnaround story of MAB.

Bellew said MAB was making good progress in its restructuring and the airline just needed another few percentage upside on the yield to be into profit.

“Our recovery plan is half-way through. In fact we can say we are little bit ahead (of schedule). And it’s all about revenue and cost control.

“Taking the right routes, improving the sales and marketing and by increasing the load factors, we should increase the revenue. Next year, we are expected to be able to break even across some of the quarters, start making profit and to show consistent profit in the following year,” said Bellew.

The group comprises its ground-handling unit AeroDarat Services Sdn. Bhd. and MAB’s units -– MASWings Sdn. Bhd., Firefly Sdn. Bhd. and MASkargo Sdn. Bhd.

Bellew described the expansion of selected new routes throughout this year till 2019 as a significant step forward for the airline, capitalising on a booming population, increasing middle class and incredible growing economies of China, India, as well as in Japan, South Korea and Taiwan.

MAB is halfway through its US$1.39 billion (RM6 billion) restructuring exercise which is likely to be completed in five years. The exercise was put into place in 2015 during the time of his predecessor, Christoph Mueller.

Bellew took over as CEO on July 1, 2016, after Mueller left, citing personal reasons. — Bernama

 

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