Malaysia Airlines posts loss in first quarter

MALAYSIA Airlines has reported net loss of MYR695 million (US$196 million) for its first quarter ending 31 March 2009.

Even though total operating expenditure was decreased by 20 per cent – mainly due to a MYR730 million ($207 million) reduction in the airline’s total fuel bill by lower fuel price and consumption – revenue still fell to MYR2.7 billion ($767 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 company said in a statement.

It remains optimistic saying: “The airline’s fundamentals remain strong. At a time when cash is king and access to capital is limited, Malaysia Airlines’ liquidity is strong with a cash balance of RM3.8 billion ($1 billion).”

Managing director and chief executive officer, Dato’ Sri Idris Jala, said Malaysia Airlines will make more costs cuts by up to 1 billion ringgit ($286 million) this year by deferring new aircraft deliveries until the end of 2010, freezing new recruitment and cutting budgets across the company.