Struggling flag carrier Malaysia Airlines said Wednesday it slipped back into the red in the first quarter due to a foreign exchange loss after two quarters of profits.
The airline said in a filing to the stock exchange that it posted a net loss of 278.6 million ringgit ($91.8 million) for the three months ending March 31, compared to a net loss of 171.3 million ringgit in the same quarter last year.
It said in a statement that the quarter’s loss was mainly due to “an unrealised forex loss of 21 million ringgit”, compared to a forex gain of 200 million ringgit in the previous year.
Higher financing costs for its fleet renewal programme also impacted the bottom line, it said, with deliveries of new fuel-efficient aircraft.
“The continued high jet fuel prices, added capacity in the market and increased competition, put pressure on our yields,” group chief executive officer Ahmad Jauhari Yahya said.
“The business environment is tough, but Malaysia Airlines is now able to respond faster to changes in the market.”
Revenue for the quarter increased 14 percent to 3.55 billion ringgit from 3.11 billion ringgit year-on-year. The airline said it saw a 17 percent increase in passenger traffic.
Last year, the carrier admitted it was in “crisis”, forcing it to implement a cost-cutting campaign centred on slashing routes and other measures, which saw it record two consecutive quarters of net profit for the last six months of 2012.
This left it with a 433 million ringgit net loss for the 2012 financial year, a marked improvement from a record 2.5 billion loss the previous year.
Analysts have blamed a combination of stiff competition, poor management, change-resistant unions, government interference and other factors for the carrier’s poor performance.
Its domestic rival, Asia’s largest low-cost carrier AirAsia, said last week that its first-quarter net profit fell 39 percent year-on-year due to a foreign exchange loss on borrowings to 104.79 million ringgit.
Malaysia Airlines back in red in first quarter
