Despite fuel price uncertainties, Malaysia Airlines' parent company returns to profit

[ASEAN NOW Content Team]

 

Malaysia Airlines' parent company, Malaysia Aviation Group (MAG), has returned to profitability, despite warnings about the impact of rising fuel prices on operational costs.

The group had a positive EBITDA of MYR433 million ($101 million) for the year ended December 31, 2021, compared to a loss of MYR1.8 billion in 2020.
MAG did not provide a breakdown of how each of its units performed throughout the year.

 

Cargo operations were an important revenue driver during the period, with revenues of roughly MYR3 billion reported by freight business MAB Kargo.
The unit also surpassed revenue projections by 71 percent, according to MAG.

As a result of superior airline revenue maximisation, Malaysia Airlines was able to boost passenger yield despite a decline in traffic and capacity - by 62 percent and 71 percent, respectively - despite a drop in traffic and capacity.

The airline firm exited reorganisation in 2021, allowing it to "holistically rebuild its balance sheet and address decades-long legacy difficulties," according to the company.

 

MAG claims that by restructuring, it was able to reduce liabilities by nearly MYR15 billion and remove debt by MYR10 billion.

"Lower operating costs from the group's cost-cutting/avoidance measures, as well as lower lease costs following its successful restructuring, contributed further to the improved performance in 2021," the company says.

According to MAG's forecast, cargo operations will continue to drive revenue growth.
It says that the liberalisation of borders throughout the world is causing a "significant increase" in passenger travel demand.
It had stated that by the end of the year, it intends to run at 70% of pre-pandemic capacity.