KUALA LUMPUR, March 21 — The Malaysia Aviation Group (MAG) returned to the black with a net profit of RM766 million for the financial year ended December 31, 2023 (FY2023), a swing of nearly RM1.1 billion against a net loss of RM344 million in FY2022.
The group recorded higher revenue of RM13.85 billion, an increase of 31 per cent against RM10.61 billion in FY2022.
It also recorded a net operating profit of RM889 million for the financial year 2023 (FY2023), marking a robust 64 per cent increase from the RM540 million recorded in FY2022.
As of Dec 31, 2023, MAG’s cash balance stood strong at RM4.27 billion, indicative of its financial stability and strategic foresight.
Group managing director Datuk Captain Izham Ismail attributed the milestone achievement of the group’s first-ever net profit and strong performance to robust passenger traffic from the premium segment, intensified international network flow, and active capacity management.
He said this during MAG’s FY2023 Annual Performance briefing today, where he highlighted the collaboration between airlines and aligned non-airline ventures, along with stronger yield for the passenger segment.
“These were achieved despite higher operational and labour costs, weaker ringgit, challenges in supply chains due to increasing costs and uncertain delivery commitments, fuel prices, and elevated interest rates,” added Izham.
Meanwhile, Malaysia Airlines Bhd’s (MAB) total revenue improved by 45 per cent year-on-year, underpinned by higher capacity, strong demand, and a focus on the international sector for the passenger business segment.
MAB achieved a significantly higher operating profit of RM1.10 billion from RM80 million in 2022, while its capacity was at 90 per cent of that in 2019.
Meanwhile, the group’s cargo arm, MAB Kargo Sdn Bhd (MASkargo), recorded a lower operating profit due to the further softening of freight cargo demand and increased market competition.
MAB Engineering Services Sdn Bhd continued to gain traction and performed well, with third-party revenue now contributing 24 per cent of its revenue.
The group has achieved significant progress in its Long-Term Business Plan 2.0 turnaround plan following its successful financial restructuring in 2021, achieving positive earnings before interest, taxes, depreciation and amortisation, reduction in fiscal losses, as well as healthy operational cash flow, said Izham.
Looking ahead, he said MAG is poised to capitalise on the momentum generated in 2023 and continue its journey toward sustainable growth, focusing on driving innovation, enhancing operational efficiency and delivering superior experiences to customers.
He also noted that the group’s non-airline aviation services businesses are expected to contribute up to 30 per cent of the group’s total topline by 2025, amidst the anticipated softening of air travel yields in the latter part of 2024.
“In line with our fleet modernisation and growth strategy, MAG is on track to integrate 12 new aircraft into its fleet in 2024. We are optimistic about operating a fleet consisting of 50 narrow-body and 50 wide-body aircraft by 2033,” he added.
Meanwhile, group chief strategy and transformation officer Bryan Foong said the group is closely monitoring the delivery schedule of 10 narrowbody aircraft, specifically the B737-8 Max, slated for delivery this year.
“As a network, we have been quite impacted by the lack of aircraft that they promised to deliver. So, we continue to work with Boeing on ways to resolve this problem,” he said, adding that safety is a top priority for MAG and will continue to emphasise safe operations.
Foong added that the group is expecting to receive its inaugural A330 Neo on Sept 27, 2024.
— Bernama
