Manila Bulletin
May 29, 2011
KUALA LUMPUR (AFP) - Flag-carrier Malaysia Airlines said Wednesday it posted a first quarter net loss due to rising fuel prices and a strengthening ringgit.
The firm said it saw a net loss of 242.3 million ringgit ($79.0 million) in the first three months of the year, compared with a net profit of 320.3 million in the same quarter of 2010.
It recorded an operating loss of 267 million ringgit despite a 10 percent growth in passenger revenue that was fuelled by a 40 percent surge in its high-end business.
Earnings were hammered by a 32 percent year on year jump in fuel prices, while overseas business was hit by the ringgit, which makes Malaysian goods more expensive for clients abroad, Malaysia Airlines said.
Natural disasters and political unrest further impacted income, it said.
In March the International Air Transport Association said high oil prices would cut the industry profits by nearly half this year despite the growth in air travel with the economic recovery.
IATA said it was downgrading its profit outlook for the sector in 2011 to $8.6 billion from the $9.1 billion it estimated in December.
Despite Wednesday's data chief executive officer Tengku Azmil Zahruddin said the airline would continue to focus on growth strategies, including updating aircraft and attracting more customers through better services and marketing.
''We will not change our profitability targets and will work on adapting our strategies to ensure that the targets are met as best as possible, given the tough operating environment we are in,'' Tengku Azmil said.
Malaysia Airlines has so far ordered 35 Boeing 737-800, 15 Airbus A330-300 and six Airbus A380-800.
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