Net profit for fourth quarter down by 67% and 65%, respectfully
The well-established Asian flag carriers Thai Airways and Malaysia Airlines have both reported a fourth-quarter net profit slump of 65-67%, compared to the same period in 2009. Malaysia Airlines’ net profit declined by 65% to MYR 225.9 million (€53.8 million), while Thai Airways suffered a 67% drop in profit to THB 2.94 billion (€69.3 million). The figures fly in the face of IATA figures indicating a recovery for the sector.
Malaysia Airlines said that the previous year’s figures had been inflated by derivative gains from the carrier’s fuel hedging and it warned that it could be seriously impacted this year by the high cost of fuel.
“It is difficult to predict how the price will behave over the course of the year,” Malaysia Airlines CEO Azmil Zahruddin said. “At this point, we have restructured our hedge levels to 25% of fuel requirements at USD$88 for 2011, in line with our peers.”
Thai Airways blamed rising wage costs and lower foreign exchange gains, bringing net profit down lower than predicted in forecasts. But a recovery in tourism will benefit the carrier in 2011 and it has raised fuel surcharges in an effort to cover the high fuel costs.
[pictured: Thai Airways cabin crew]