KUALA LUMPUR, June 12 — National carrier Malaysian Airline System (MAS) posted its first quarterly loss in 2½ years, hit by a triple whammy of overcapacity, volatile fuel prices and a global slump that hit passenger and cargo demand.
The airline said it had revalued its fuel hedges under new accounting rules to reflect their market value and took a first-quarter charge of RM3.8 billion but said it could see a RM1.1 billion gain if oil prices averaged US$66 a barrel in the second quarter.
Analysts predict competition will intensify amid weak demand and fresh capacity coming onstream from full-service and budget airlines in the region.
Singapore Airlines, the world's largest carrier by market value, last month reported a sharp drop in its quarterly net profit, hit by fuel hedging losses and a weak travel market, and also warned that the H1N1 flu outbreak could delay air travel recovery.
MAS reported a January-March net loss of RM695 million versus a year-earlier profit of RM120 million. It said it had a first-quarter fuel hedging loss of RM557 million, and an operational loss of RM138 million.
"This is the first operational loss for Malaysia Airlines since the third quarter of 2006 as it faced a triple squeeze, overcapacity, extreme fuel volatility and a global slump which hit passenger and cargo demand," the airline said in a statement.
The International Air Transport Association said on Monday the global airline industry faces an unprecedented crisis and is likely to lose US$9 billion (RM31.5 billion) this year, nearly double an estimate made just three months ago.
Before the latest results, analysts were expecting MAS to post 2009 net profit of RM187 million, according to Reuters estimates, down from RM244 million last year.
MAS shares have risen 6.5 per cent this year, trailing a 24 per cent gain on the main Malaysian stock index. Trading in the stock was suspended yesterday. — Reuters
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