Malaysia Airlines A380
Malaysia Airlines has posted a 2013 net loss of MRY1.17 billion ($356 million), nearly tripling the airline’s 2012’s net loss of MRY432.6 million.
2013 revenue for the Kuala Lumpur-based carrier rose 9.9% to MRY15.12 billion as 2013 expenses increased 9.6% to MRY14.87 billion, resulting in an operating profit for the year of MRY254.2 million, up 35.7% year-over-year.
“The full-year performance of [Malaysia Airlines] making a bigger loss in 2013 compared to 2012 demonstrates the challenges brought on by intensifying competition leading to lower yields for all players,” Malaysia Airlines Group CEO Ahmad Jauhari Yahya said. “Many airlines are investing heavily in new aircraft and new products and services. This has resulted in a significant increase in capacity and aggressive competition in fares and value proposition to attract and keep market share. It makes having to focus on major structural costs review and driving business efficiency for Malaysia Airlines even more urgent.”
For the full-year 2013, Malaysia Airlines’ traffic rose 27.2% to 47.29 billion RPKs on a 17.4% rise in capacity to 58.38 billion ASKs, producing a load factor of 81%, up 6.3 points from 2012. Yield fell 13% year-over-year to MRY23 sen per RPK. 17.2 million passengers were transported in 2013, up 28.5% from 2012.
In the 2013 fourth-quarter, the Malaysia flag-carrier posted a net loss of MRY343.4 million, a steep drop year-over-year from the carrier’s MRY51.4 million profit reported in 2012’s December quarter. Fourth-quarter revenue rose 0.8% to MRY3.9 billion. Expenses increased 7% year-over-year to MRY3.95 billion, leading to an operating deficit of MRY56.3 million—a significant decline from the carrier’s 2012 fourth-quarter operating profit of MRY170.6 million.
“We knew 2013 would be a challenging year of intense competition, which would impact yield,” Ahmad Jauhari said. “We expect the pressure on yield to continue. We will intensify efforts to reduce our costs, focusing on inherent legacy costs, while increasing utilization to drive traffic and revenue.”
As of Dec. 31, 2013, Malaysia Airlines had received 21 new aircraft during the year, including Airbus A380s, A330s, an ATR 72-600 and one new Boeing 737-800 each month. The carrier’s total fleet stands at 148 aircraft, including six A380s.
The airline recently announced it is suspending service to the US, ending its Kuala Lumpur-Los Angeles route at the end of April. The move is part of the carrier’s “route rationalization” exercise aimed at stemming losses.