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MAHB 2Q net profit jumps 7.1 times

MAHB 2Q net profit jumps 7.1 times

KUALA LUMPUR: Malaysia Airports Holdings Bhd (MAHB) saw its second-quarter (2Q) net profit jump 7.1 times contributed by the Malaysian operations, which more than offset the higher pre-tax loss from its overseas operations. The group’s net profit for the three months ended June 30, 2017 (2QFY17) rose to RM66.93 million from RM9.38 million a year ago. Earnings per share was 2.29 sen in 2QFY17 compared with a loss per share of 1.21 sen in 2QFY16. Quarterly revenue also rose 10.3% to RM1.1 billion in 2QFY17 from RM997.6 million in 2QFY16, driven by its Malaysian and overseas operations. The airport operator declared an interim dividend of five sen per share totalling RM82.96 million for the FY17, payable on Aug 25.

In a filing with Bursa Malaysia yesterday, MAHB said revenue from its airport operations in Malaysia for 2QFY17 rose 12.4% year-on-year (y-o-y) to RM795.7 million, mainly due to a higher non-aeronautical revenue which grew 16.7% y-o-y. “The main contributing factors to the increase was higher passenger growth, which has resulted in higher retail and rental revenues by 20.6% and 12.5% respectively,” it added. Passenger traffic at the 39 airports operated by MAHB in Malaysia grew 13.8% to 23.9 million passengers in 2QFY17 from 21 million passengers in 2QFY16.

MAHB said the increase in airport operations revenue in Malaysia was also due to the increase in aeronautical revenue, which rose 8.5% y-o-y driven by a higher passenger service charge. The strong second-quarter performance lifted the group’s net profit for the cumulative six months (1HFY17) nearly five times to RM128.94 million from RM26.39 million a year ago, while revenue increased 8.8% to RM2.19 billion from RM2.02 billion in the first half of FY16 (1HFY16). This was despite its wholly-owned subsidiary Istanbul Sabiha Gokcen Airport in Turkey recording a higher pre-tax loss by 34.1% to RM178.6 million in 1HFY17 from RM133.2 million in 1HFY16.

Going forward, MAHB cautiously expects its performance for FY17 to be better than the previous year due to the improvement in passenger growth, which it said was driven by a new level of growth contributed by visa relaxation measures for China and India, new additions in the local travelling population, increase in Umrah travel, competitive fares, as well as favourable exchange rate for foreign tourists. “The increase in demand was adequately supported by [an] increase in airlines’ seat capacity. Seat capacity supply estimates for the second half of 2017 (2H17) indicate a 6% growth over 2H16, setting the tone for a solid year for passenger growth,” it added. MAHB shares closed at RM8.75 yesterday, giving it a market capitalisation of RM14.51.