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AN OVERVIEW TO SELECTED COMPANY

Recently all of us in Malaysia countries was startled with the most mysterious news of
missing MH370 plane which couldnt be found until today. Everybody from internal and
eternal agencies have shown their effort to find this most sophisticated airplane. !n fact "this
#ind of misfortune condition happened once in a many years. $e believe that" this is one of
the tests from %llah. &espite" we are eposed to the some of the speculation news" but we
have to slowly search for the right evidence so that no doubtful eist among people.
%s we #now that the most epensive cost for the transportation is when we travel by
aeroplane such as M%'" %irasia" (irefly" M%)!*&+,new- and a few more. .he wise
passenger always free to find out which is the best value fares to go on vacation. .he
/uestion is when is the most good time to fly0 .he answer is we must #eep on loo#ing at the
tic#ets offered by these number of flies via online or other promotion advertised anywhere
and anytime. $e found that normally" the price for fares are always fluctuate and we must
study the flow of when is the best buy0
)oo#ing at the number of airways company in Malaysia" we propose to select the Malaysian
%irlines 'ystem as our target companies to be discussed on overall aspects but especially we
li#e to be more highlight on financial performance. (inancial performance is the vital parts
for every companies that could deliver message" perception or decision ma#ing as we
analy1ed the figures given. (or that ob2ective" we shall elaborate on every topics which will
be discussed further.
Malaysian %irlines 'ystem ,M%'- ,Malay3 Sistem Penerbangan Malaysia- is the flag carrier
of Malaysia and a 45star airline. Malaysia %irlines ,M%'- operates flights from its home
base" 6uala )umpur !nternational %irport and with a secondary hub in 6ota 6inabalu and
6uching. .he airline has its head/uarters on the grounds of 'ultan %bdul %1i1 'hah %irport
in 'ubang" 'elangor" in 7reater 6uala )umpur. !t is a member of the +neworld airline
alliance. Malaysia %irlines operates flights in 'outheast %sia" East %sia" 'outh %sia" Middle
East and on the 6angaroo Route between Europe and %ustralasia. !t operates transpacific
flights from 6uala )umpur to )os %ngeles" via .o#yo ,to be discontinued from 30 %pril 809:
%part from the airline the group also includes aircraft maintenance" repair and overhaul
,MR+-" and aircraft handling. Malaysia %irlines has two airline subsidiaries3 (irefly and
M%'wings. (irefly operates scheduled flights from its two home bases ;enang !nternational
%irport and 'ubang !nternational %irport. .he airline focuses on tertiary cities. M%'wings
focuses on inter5<orneo flights. Malaysia %irlines has a freighter fleet operated by
M%'6argo" which manages freighter flights and aircraft cargo5hold capacity for all Malaysia
%irlines= passenger flights. M%'>harter is another subsidiary of Malaysia %irlines" operating
charter flights using Malaysia %irlines= aircraft. %fter recovering from past losses" Malaysia
%irlines is #een on merger and ac/uisition ,M?%- activities3 particularly airlines in the %sia
;acific region. Malaysia %irlines was ran#ed second with score @@ in %viation $ee#=s .op
;erforming >ompanies which measures financial viability of an airline. Malaysian %irlines
'ystem slogan is a ABourney are made by the people you travel withC.
HISTORY
Malayan aviation history
'cheduled air passenger and mail services in Malaya commenced in 9D37 when $earne=s %ir
'ervice ,$%'- commenced operating services between 'ingapore" 6uala )umpur and
;enang. $earne=s %ir 'ervice was started by two %ustralian brothers" .heodore and >harles
$earnes. .he service commenced as a thrice wee#ly flight between 'ingapore and ;enang
.he first flight" using an @5seater de Havilland &H.@D% &ragon Rapide too# place on 8@ Bune
9D37 .his inaugural flight departed 'ingapore from the then brand5new 6allang %irport
which had 2ust opened earlier in the same month on 98 Bune )ater a second &.H.@D%
enabled the epansion to daily services as well as the addition of !poh as a destination. .he
$%' services ceased with the onset of the 'econd $orld $ar Bapanese occupation of Malaya
and 'ingapore.
Beinnins
An MSA Boein !"! at #$ri%h&'loten Air(ort) *+,!-.
%n initiative by the %lfred Holt=s )iverpool5based +cean 'teamship >ompany" in partnership
with the 'traits 'teamship >ompany and !mperial %irways" resulted in the incorporation in
'ingapore on 98 +ctober 9D37" Malayan Airways Limited (MAL). <ut the first paying
passengers could be welcomed on board only some 90 years later. %fter the war" M%) was
restructured to include 2ust the partnership of 'traits 'teamship and +cean 'teamship. .he
airline=s first flight was a charter flight from the <ritish 'traits 'ettlement of 'ingapore to
6uala )umpur" on 8 %pril 9D:7" using an %irspeed >onsul twin5engined aircraft. .his
inaugural flight on the ERa2a FdangE" with only five passengers" departed 'ingapore=s
6allang %irport and was bound for 6uala )umpur=s 'ungai <esi %irport. $ee#ly scheduled
flights /uic#ly followed from 'ingapore to 6uala )umpur" !poh and ;enang from 9 May
9D:7 with the same aircraft type. .he airline continued to epand during the rest of the 9D:0s
and 9D40s" as other <ritish >ommonwealth airlines ,such as <+%> and Gantas Empire
%irways- provided technical assistance" as well as assistance in 2oining !%.%. <y 9D44"
Malayan %irways= fleet had grown to include a large number of &ouglas &>53s" and went
public in 9D47. +ther aircraft operated in the first two decades included the &ouglas &>5:
'#ymaster" the Hic#ers Hiscount" the )oc#heed )590:D 'uper >onstellation" the <ristol
<ritannia" the &e Havilland >omet : and the (o##er (87. +ver the net few years" the airline
epanded rapidly" boosted by post5war air travel demand when flying became more than a
privilege for the rich and famous. <y 98 %pril 9DI0" the airline was operating &ouglas &>5
3s" 'uper >onstellations and Hiscounts on new routes from 'ingapore to Hong 6ong" and
from 6uala )umpur to <ang#o# via ;enang. (lights were also introduced from 'ingapore to
cities in the <orneo .erritories" including <runei" Besselton ,now 6ota 6inabalu-" 6uching"
'anda#an and 'ibu.
!n 9D47" the airline became a state5run stoc# corporation. $ith the delivery of an @:5seat
<ristol <ritannia in 9DI0" the airline launched its first long5haul international flight" to Hong
6ong. $hen Malaya" 'ingapore" 'abah and 'arawa# formed the (ederation of Malaysia in
9DI3" the airline=s name was changed" from EMalayan %irwaysE to EMalaysian %irwaysE
,though still abbreviated to M%)-. M%) also too# over <orneo %irways. !n 9DII" following
'ingapore=s separation from the federation" the airline=s name was changed again" to
Malaysia5'ingapore %irlines ,M'%-. .he net year saw a rapid epansion in the airline=s fleet
and routes" including the purchase of M'%=s first <oeing aircraft3 the <oeing 707s" as well as
completion of a new high5rise head/uarters in 'ingapore. <oeing 737s were added to the fleet
soon afterward.
In%or(oration
<oeing 7375800 of M%' at <runei !nternational %irport in 9D@7.
.he differing needs of the two shareholders" however" led to the brea#5up of the airline 2ust I
years later. .he 'ingapore government preferred to develop the airline=s international routes"
while the Malaysian government had no choice but to develop the domestic networ# first
before going regional and eventually international. M'% ceased operations in 9D78" with its
assets split between two new airlinesJ Malaysian %irline 'ystem ,M%'-" and 'ingapore
%irlines.
$ith the 'ingapore government determined to develop 'ingapore %irlines= international
routes" it too# the entire fleet of seven <oeing 707s and five <oeing 737s" which would allow
it to continue servicing its regional and long5haul international routes. 'ince most of M'%=s
international routes were flown out of 'ingapore" the ma2ority of international routes were in
the hands of 'ingapore %irlines. !n addition" M'%=s head/uarters" which was located in
'ingapore" became the head/uarters of that airline.
.he initials M'% were well regarded as an airline icon" and both carriers tried to use them.
Malaysian went for M%' by 2ust transposing the last two letters and choosing the name
Malaysian %irline 'ystem" while 'ingapore originally proposed the name Mercury 'ingapore
%irlines to #eep the M'% initials" but changed its mind and went for '!% instead. %cronyms
for airline names later became less fashionable" and both carriers then moved on to their
descriptive names Malaysian %irline 'ystem too# all domestic routes within Malaysia and
international routes out of that country" as well as the remaining fleet of (o##er (87=s. !t
began flights on 9 +ctober 9D78 and soon epanded" including introducing flights from 6uala
)umpur to )ondon.
!n that year M%' operated flights to more than 3: regional destinations and si international
services. !n 9D7I" after receiving its &>590530 aircraft" M%' scheduled flights reached
Europe" with initial flights from 6uala )umpur to %msterdam" ;aris and (ran#furt. %n
economic boom in Malaysia during the 9D@0s spurred growth at Malaysia %irlines. <y the
end of the decade M%' was flying to :7 overseas destinations" including eight European
destinations" seven +ceania destinations" and Fnited 'tates destinations of )os %ngeles and
Honolulu. !n 9DD3 Malaysia %irlines reached 'outh %merica when the airline received its
<oeing 7:7 aircraft. M%' became the first airline in 'outheast %sia to serve 'outh %merica
via its flights to <uenos %ires" %rgentina. Malaysia %irlines also flew to Meico >ity
between 9DD: and 9DD@ with fifth5freedom rights to carry passengers between Meico >ity
and )os %ngeles" en route to 6uala )umpur.
/irst (erio0 o1 2n(ro1ita3ility
;rior to the %sian (inancial >risis in 9DD7" the airline suffered losses of as much as RM 8I0
million after earning a record5brea#ing RM39D million profit in the financial year 9DDIK9DD7.
.he airline then introduced measures to bring its ;?) bac# into the blac#. (or the financial
year 9DDDK8000" the airline cut its losses from RM700 million in the year 9DD@K9DDD to
RM84D million. However" the airline plunged into further losses in the following year"
amounting to RM:97 million in (L8000K8009 and RM@3I million in (L8009K8008. $ith
these losses" the airline cut many unprofitable routes" such as <russels" &arwin" Honolulu"
Madrid" Munich and Hancouver. .he airline recovered from its losses in the year 8008K8003.
!t achieved its then5highest profit in the year 8003K800:" totaling RM:I9 million.
Se%on0 (erio0 o1 2n(ro1ita3ility
Regional services flown by (o##er (40s" such as this one" were once operated at a substantial
loss. !n the year 8004" Malaysia %irlines reported a loss of RM9.3 billion. Revenue for the
financial period was up by 90.3M or RM@8I.D million" compared to the same period for
800:" driven by a 90.8M growth in passenger traffic. !nternational passenger revenue
increased by RM:47.I million or @.:M" to RM4.D billion" while cargo revenue decreased by
RMI:.9 million or :.8M" to RM9.4 billion. >osts increased by 8@.@M or RM8.3 billion"
amounting to a total of RM 90.3 billion" primarily due to escalating fuel prices. +ther cost
increases included staff costs" handling and landing fees" aircraft maintenance and overhaul
charges" $idespread %ssets Fnbundling ,$%F- charges and leases.
.he most substantial factor in the losses was fuel costs. (or the period" the total fuel cost was
RM3.4 billion" representing a :0.:M increase compared to the same period in 800:. .otal fuel
cost increases comprised RMD77.@ million due to higher fuel prices and another RM947.I
million due to additional consumption. !n the third /uarter" fuel costs were RM9.8I billion"
compared to the RM9.09 billion in the corresponding period in 800:" resulting in a 8:.IM
increase or RM8:D.3 million.
%nother factor for the losses was poor revenue management. M%' substantially lagged its
peers on yield. 'ome of this gap was due to differences in traffic mi" with less business
traffic to and from Malaysia than to and from 'ingapore" but much of it was due to
wea#nesses in pricing and revenue management" sales and distribution" brand presence in
foreign mar#ets" and alliance base. Malaysia %irlines has one of the lowest labour costs per
%'6 at F'&0.:9" compared to other airlines such as >athay ;acific and 'ingapore %irlines at
F'&0.4D and F'&0.I0 respectively. However" despite low labour costs" the ratio of %'6
revenue to this cost was" at 8.@" much lower than 'ingapore %irlines" where the ratio is 4.0"
and slightly higher than .hai !nternational %irways..here are other factors listed in the
<usiness .urnaround ;lan of Malaysia %irlines" all leading to the net loss of RM9.3 billion in
the year 8004.
Re%overy 1ro4 2n(ro1ita3ility
Fnder the various initiatives" launched together with the <usiness .urnaround ;lan" Malaysia
%irlines switched from losses to profitability between (L800I and (L8007. $hen the
<usiness .urnaround ;lan came to an end" the airline posted a record profit of @49 million
Ringgit ,8I4 million dollars- in 8007" ending a series of losses since 8004. .he result
eceeded the target of RM300 Million by 9@:M.
Route rationalising was one of the ma2or contributors to the airline=s return to profitability.
Malaysia %irlines pared its domestic routes from 99: to 88" and also cancelled virtually all
unprofitable international routes ,such as 6uala )umpur5Manchester" that re/uired a 9:0M
load factor to brea# even-. %part from that" Malaysia %irlines also rescheduled all of its flight
timings and changed its operations model from point to point services to hub and spo#e
services.
%dditionally" the airline started ;ro2ect +mega and ;ro2ect %lpha to improve the company=s
networ# and revenue management. Emphasis has been placed on si areas3 pricing" revenue
management" networ# scheduling" opening storefronts" low season strategy and distribution
management.
Malaysia %irlines has been involved in discussions for new aircraft purchases" using its cash
surplus of 4.3 billion Ringgit to eventually purchase 44 narrow5body aircraft and 44 wide5
body aircraft.
&espite these achievements" critics continue to deride the carrier for lagging behind its
competitors in the region. .his notion is not helped by the fact Malaysia %irlines has not
made substantial investments in customer service" especially compared to .hai %irways or
'ingapore %irlines. +n 88 &ecember 800D" Malaysia %irlines announced the purchase of 94
new %irbus %330 aircraft" with options for another 90. Epected to be delivered between
8099 and 809I" they are intended to operate on medium5haul routes to eastern %sia" %ustralia"
and the Middle East. .he airline=s plans are to run %irbus %3@0 planes" which will be
introduced into service in 8098" on long5haul routes" %330s on medium5haul routes" and
<oeing 737 aircraft on short5haul routes. Fnder this plan" it is unclear where <oeing wide5
bodies currently in the fleet would fall.
Thir0 2n(ro1ita3ility5e0it6
!n 8099" Malaysia %irlines recorded a stunning net loss of RM8.48 billion due to rising fuel
costs and mismanagement which was the largest in its company history. .he company ceased
operations to 'urabaya" 6arachi" &ubai" &ammam and Bohannesburg in Banuary" and ceased
flights to >ape .own" <uenos %ires as well as Rome in (ebruary.
DATE O/ ESTABLISHMENT AND THE SIT7ATION
O/ B7SINESS OPERATIN8
!n 9D@7" Malaysia %irlines commenced operations after the airline changed its name from
Malaysian Airline System. .he airline began in 9D:7 as Malayan %irways" being renamed
Malaysian %irways after Malaysia gained independence. %fter that" it changed its name once
more to Malaysia5'ingapore %irlines and thereafter ceased its operation. !t was then divided
into Malaysia %irlines and 'ingapore %irlines. %n %irspeed >onsul" the first aircraft type
operated by Malayan %irways.
.he 7overnment of Malaysia appointed !dris Bala as the new >E+ on 9 &ecember 8004" to
eecute changes in operations and corporate culture. 'everal wea#nesses in airline operations
were identified as the causes of the RM9.3 billion loss. .hese included escalating fuel prices"
increased maintenance and repair costs" staff costs" low yield per available seat #ilometer
,E%'6E- via poor yield management and an inefficient route networ#. Fnder the leadership
of !dris Bala" Malaysia %irlines launched its <usiness .urnaround ;lan in 800I" developed
using the 7overnment5lin#ed company ,7)>- .ransformation Manual as a guide.
+n 8@ (ebruary 8093" %hmad Bauhari Lahya" the group >hief Eecutive +fficer" reported a
net profit of RM49.:mil for the fourth /uarter" reversing the net loss of RM9.3bil a year
earlier. M%'= improved financial performance last year was mainly attributable to its route
rationali1ation programme" which saw an overall IM reduction in available seat #ilometre
,%'6-. .his was matched by a marginal 8M reduction in revenue to RM93.7Ibil in 8098 and
seat factor holding at 7:.7M. .he reduced %'6 also helped M%' register a corresponding
93M decrease in ependiture.
Cor(orate in1or4ation5e0it6
Malaysia %irlines is listed on the stoc# echange of <ursa Malaysia under the name
Malaysian Airline Syste4 Berha0. .he airline suffered high losses over the years due to
poor management and fuel price increases. %s a result of financial restructuring ,Wi0es(rea0
Asset 7n32n0lin- in 8008" led by Bina/i9ir" ;enerbangan Malaysia <erhad became its
parent company" incorporated in 8008" in echange for assuming the airline=s long5term
liabilities. +n the operational side" the 7overnment of Malaysia appointed !dris Bala as the
new >E+ on 9 &ecember 8004" to eecute changes in operations and corporate culture.
Fnder his leadership" Malaysia %irlines unveiled its <usiness .urnaround ;lan ,<.;- in
(ebruary" 800I" which identified low yield" an inefficient networ# and low productivity
,overstaffing-. .he airline head/uarters building in downtown 6uala )umpur was sold. .he
new corporate head/uarters is now at the M%' >omple on the grounds of 'ultan %bdul %1i1
'hah %irport in 'ubang" 'elangor.
<oeing 7:75:00 DM5M;& of Malaysia %irlines in the special EHibiscusE livery" ta#ing off at
Heathrow %irport.
(ollowing the $idespread %sset Fnbundling ,$%F- restructuring of Malaysia %irlines"
Malaysian 7overnment investment arm and holding company" 6ha1anah *asional=s
subsidiary" ;enerbangan Malaysia <erhad is the ma2ority shareholder with a 48.0M sta#e.
%fter ;enerbangan Malaysia <erhad" the second5largest shareholder is 6ha1anah *asional"
which holds 97.33M of the shares. Minority shareholders include Employees ;rovident (und
<oard ,90.78M-" %manah Raya *ominees ,.empatan- 'dn <hd ,4.IDM-" 'tate (inancial
'ecretary 'arawa# ,8.79M-" foreign shareholders ,4.93M- and $arisan Harta 'abah ,8.:M-.
!t has 9D"4:I employees ,as of March" 8007-. .he Malaysian government reported that the
government=s holding company" 6ha1anah *asional is #een on selling shares of Malaysia
%irlines to remain globally competitive in an industry which is fast5consolidating.
Hea0 o11i%e
.he airline has its head/uarters and reistere0 o11i%e on the third floor of %dministration
<uilding % at S2ltan A302l A:i: Shah Air(ort in S23an; Selanor" in 8reater
'2ala L24(2r. .he head office is located near .erminal 3 of the airport. ;reviously
the airline head/uarters were on the third floor of the M%' %dministrative >omple
at 'ubang %irport" in 'ubang. ;rior to the construction of the 6uala )umpur M%'
head/uarters" the airline rented space in the FM<> head/uarters. .he airline had a
permanent corporate head/uarters in the <angunan M%'" a 3:53I story building it
owned along <alan S2ltan Is4ail" in the 8ol0en Trianle. .he airline occupied 80
stories in the building. .he building was built for
RM@@mil. !n 8004 The Star said that the building was Ereported to be worth between
RM300mil and RM340milE. %t one time before 8004 the airline chaiperson" Ra2a .un Mohar"
made an oral promise to .un %bdul Ra1a# of the 7overnment of Malaysia that the airline
would not sell its head/uarters. .he airline had I00 employees in the building.
!n 800I" the airline moved its head office from the 6uala )umpur building to the former
head/uarters in 'ubang" in order to reduce inefficiencies and generate cash. Channel News
Asia stated that the airline had been EforcedE to sell the former head/uarters. !dris Bala" the
managing director" said that the sale could net RM3bil. !n the event it did not" the airline
would try to rent out the floors it occupied. .he first phase was scheduled to occur from
Banuary to March of that year" with the chairperson" eecutive director" managing director"
company secretary" corporate communication officer" and finance communication officer
moving to the 'ubang facility. !n Bune 800I" ;hase !! was planned as a move for the
distribution" mar#eting" and sales divisions of the company" to %dministration <loc# .hree.
%round 8007 ;ermodalan *asional <hd purchased <angunan M%' from the airline. .he new
owners planned to remodel the building" by installing a five star hotel apartment bloc# and
upgrade the offices to 7rade %NN. .he airline planned to relocate its head/uarters from
'ultan %bdul %1i1 'hah %irport to 6uala )umpur !nternational %irport in 'epang" 'elangor
in 7reater 6uala )umpur in (ebruary 8098.
NAT7RE O/ B7SINESS
S23si0iaries
Malaysia %irlines has diversified into related industries and sectors" including aircraft ground
handling" aircraft leasing" aviation engineering" air catering" and tour operator operations. !t
has also restructured itself by spinning5off operational units as fully owned subsidiaries" to
maintain its core business as a passenger airline. Malaysia %irlines has over 80 subsidiaries"
with 93 of them fully owned by Malaysia %irlines.
'ome of the subsidiaries include3
Co4(any Ty(e Prin%i(al
a%tivities
In%or(orate0
in
8ro2(=s E>2ity
Sharehol0in
Malaysia %irlines >argo
'dn. <hd
'ubsidiary >argo Malaysia 900M
7E Engine 'ervices
Malaysia
Boint
Henture
Engine +verhaul Malaysia 30M
M%'wings 'dn. <hd. 'ubsidiary %irline Malaysia 900M
(irefly 'dn. <hd. 'ubsidiary %irline Malaysia 900M
M%' %erotechnologies
'dn <hd
'ubsidiary MR+ Malaysia 900M
M%' 7olden Holidays
'dn <hd
'ubsidiary .our operator Malaysia 900M
Malaysian %erospace
Engineering 'dn <hd
'ubsidiary Engineering Malaysia 900M
M%' %cademy 'dn <hd 'ubsidiary (light school Malaysia 900M
%bacus &istribution 'ubsidiary >omputer Malaysia @0M
'ystems ,Malaysia- 'dn
<hd
reservation
system
.a2 Madras %ir >atering
)imited
%ssociate >atering !ndia 80M
M%' >atering ,'arawa#-
'dn <hd
'ubsidiary >atering Malaysia I0M
)'7 '#y >hefs %ssociate
Holding
company
Malaysia 30M
The 7ni>2eness Chara%teristi% o1 MAS Air(lane
i. Bran0in an0 I4ae
(rom the late 9DD0s up to 8007" Malaysia %irlines used the Going Beyond Expectations
slogan to brand itself internationally. $ith the rollout of the <usiness .ransformation ;lan in
800@" the >E+ of Malaysia %irlines re2ected the idea of using MH=s networ# or certain other
features as its new branding strategy. !nstead" the new branding strategy slogan is MH is
Malaysian Hospitality" to emphasi1e the hospitality of its cabin crew instead of the airline=s
networ# and cabin classes.
Corporate image
Malaysia %irlines introduced the 'arong 6ebaya design on 9 March 9D@I for female flight
attendants. !t was designed by the 'chool of (ashion at Mara !nstitute of .echnology ,Malay3
Institut Teknologi Mara- and later #nown as Mara Fniversity of .echnology ,Malay3
Uniersiti Teknologi Mara-. .he bati# material depicts the kelarai motif" which is a bamboo
weave pattern. !t appears in the bac#ground in subdued hues of the basic uniform colour.
'uperimposed on the kelarai motif is a miture of Malaysian flora" such as the cempa#a"
2asmine and the leaves of the hibiscus. .he geometric 'arawa#ian motif is used for the lapels
of the ba!u" edges of sleeves and the sarong. +n 9 Banuary 9DD3" the colours of the bati# were
enhanced to complement the colour of the new uniform. .he male flight attendants wear grey
colour 2ac#ets. .he stewardess= <ati# uniforms are similar to those of the 'ingapore %irlines=
'ingapore 7irls" however the shape of the collar is slightly different.
Malaysia %irlines regional cabin staff" the airline received the E$orld <est >abin >rewE
award by '#ytra in 8099.
>olour >ode of female flight attendants
Red Sarong "ebaya with yellow flowers with red bac#ground are for the !nflight
'upervisors
Sarong "ebaya with pin# flowers are for >hief 'tewardesses" )eading 'tewardesses
and (light 'tewardesses ,see difference from the name tag-
Sarong "ebaya with magenta flowers are for the ground frontliners
>olour >ode of male flight attendants
7rey >oloured Bac#ets with light grey vest and light blue shirts
Corporate logo[edit]
.he history of the airline started in 9D37" when Malayan %irways )imited was registered as a
company. (lying operations started in 9D:7" with the aircraft bearing the symbol of a winged
tiger. !n 9DI3" the airline was renamed Malaysian %irways )imited" when the (ederation of
Malaysia was formed. 'ubse/uently" <orneo %irways )imited was absorbed by Malaysian
%irways )imited. !n 9DI4" with the political separation of 'ingapore from Malaysia" there
was continued participation by the governments of Malaysia and 'ingapore in the airline. !n
9DI7" the company changed its name to Malaysia5'ingapore %irline )imited ,M'%-" which
was the 2oint national air carrier for both countries" and a new logo was introduced.
!n 9D79" Malaysia5'ingapore %irline )imited was separated into two airlines" each with its
own policies and ob2ectives" leading to the birth of Malaysia=s flag carrier" Malaysian %irline
'ystem ,M%'-" on 3 %pril 9D79. .he name was chosen because" in abbreviated form" MAS
,as in EMAS- in Malay means gold" to symboli1e /uality service.
% new corporate logo designed by &ato= Bohan %riff was introduced on 94 +ctober 9D@7"
retaining the essence of the moon #ite" with a sheared swept5bac# loo#. %long with the new
corporate logo" a new type style 5 MALAYSIA" was created. !t is italicised to slant parallel
with the logo to accentuate speed as well as direction. $ithin this corporate typestyle" the
letters MAS bear red clippings to denote the initials of the statutory name of the airline"
Malaysian %irline 'ystem ,M%'-" and were added after the original design was re2ected by
former ;rime Minister .un &r. Mahathir. .he introduction of blue to the original red logo has
national significance. .he red and blue divides e/ually in the middle to denote e/uilibrium.
+n @ March 8098" Malaysia %irlines unveiled another rebrand" with a new logo and livery.
.he red from the previous logo has been replaced entirely by blue colour tones. .he #ite now
faces from left to right" as it did in the original 9D79 logo" its tails have been etended and is
now entirely in gradient tones from grey to blue. .he wordmar# has also been modernised"
with a new typeface and the word EairlinesE is now presented in lowercase.
B7SINESS PARTNERS
Allian%e
+n 9 (ebruary 8093" the airline 2oined the +neworld airline alliance" whose members include
%merican %irlines" <ritish %irways" Gantas" >athay ;acific" and Bapan %irlines.
!n 8099 Malaysia %irlines introduced a social seating plan that allows passengers to pic#
seatmates before their flight. .he plan lets passengers share their social networ# profiles and
photos with other passengers on the same flight.
Destinations
% Malaysia %irlines <oeing 7375@00 at the 6)!% main terminal" with the aircraft denoting
with the current livery.
<efore the introduction of the <usiness .urnaround ;lan" Malaysia %irlines operated 99@
domestic routes within Malaysia and 99: international routes across si continents. Malaysia
%irlines now flies to @7 destinations across si continents from its primary hub in 6uala
)umpur. !t has a particularly strong presence in the 'outheast %sia region" which" together
with its subsidiary M%'$ings and (irefly" connects 6uala )umpur to the most destinations
in <orneo !sland. %part from that" the airline has a #ey role in the 6angaroo Route" on which
the airline provides onward connecting flights from main European gateways to ma2or
%ustralian and *ew Oealand gateways via 6uala )umpur !nternational %irport" within 4
hours. Malaysia %irlines also operates transpacific flights from 6uala )umpur to )os %ngeles
!nternational %irport via .o#yo ,previously operated via .aipei. .ransatlantic flight from
6uala )umpur to *ewar# )iberty !nternational %irport via 'toc#holm5%rlanda %irport
,*ewar# flights had previously also been routed via &ubai !nternational %irport- were ended
in +ctober 800D due to poor passenger loads. !t was recently announced that the airline will
end flights from 6uala )umpur to )os %ngeles via .o#yo effective 30 %pril 809: to focus its
services in %sia.
Fnder the <usiness .urnaround ;lan" numerous routes were aed and fre/uencies reduced.
%s of 'eptember 8007" Malaysia %irlines flies to @@ destinations. !n cooperation with code5
share partner airlines" the airline serves more than one hundred destinations worldwide. !t
was the first airline in 'outheast %sia to fly to 'outh %frica" following the demise of
apartheid" and the only airline in 'outheast %sia that served 'outh %merica via 'outh %frica
until 8098. !n 800I" it suspended its routes to Manchester" Hienna" (u#uo#a" >hengdu"
*agoya" Pi=an" >airo" 6ol#ata" %hmedabad and OQrich under its <usiness .urnaround ;lan.
Malaysia %irlines also owns its own charter flight division. Malaysia %irlines= charter flights
have flown to destinations around the world" such as 7uilin" which was previously one of
Malaysia %irlines= scheduled destinations" and >hristmas !sland. Malaysia %irlines has also
been the official airline for the Manchester Fnited %sian .our. !t also has a substantial Ha22
operation.
Malaysia %irlines applied for approval to launch 3 wee#ly 6ota 6inabalu R .o#yo Haneda
service with <oeing 7375@00" effective 94 *ovember 8090. %fter receiving regulatory
approval" Malaysia %irlines ad2usted its .o#yo operations. %ll 6uala )umpur R .o#yo traffic
departed and arrived in *arita" and 6ota 6inabalu R .o#yo traffic operated fromKto Haneda.
.he airline ended operations at .o#yo Haneda %irport on 9 (ebruary 8098.
!n 8098" it suspended services to >ape .own" &ubai ,serviced resumed in %ugust 8093-"
Bohannesburg" <uenos %ires" Rome" &ammam" 6arachi and 'urabaya due to unprofitability.
!n addition" the airline also suspended : destination3 .o#yo" +sa#a" ;erth and 'eoul from
6ota 6inabalu. .he airline has also reinstated some of 6ota 6inabalu=s previous routes such
as ;erth" +sa#a and .o#yo operations were shifted to *arita which began on 8@ +ctober 8093
,the airline previously operated flights from 6ota 6inablau to Haneda-. !ntroduction for 6ota
6inabalu to 'hanghai5;udong have also begun" thus effectively reviving 6ota 6inabalu
status as a hub.
A?@" Milestones
% Malaysia %irlines %irbus %3@05@:9" during a special flight in (arnborough %irshow.
!n 8003" Malaysia %irlines parent company" ;enerbangan Malaysia <erhad" signed a
>ontract with %irbus to purchase si %irbus %3@05@00 aircraft.
+n 7 Bune 8099" the first %3@0 for Malaysia %irlines entered into final assembly phase at the
%irbus (inal %ssembly )ine in .oulouse" (rance. +n 80 +ctober" the %3@0 ma#es its maiden
test flight from .oulouse to Hamburg upon completion of the final assembly ? system tests.
Malaysia %irlines first %3@0 to arrive in 6uala )umpur on 9D Bune 8098. Malaysia %irlines
%3@0 inaugural flight from 6uala )umpur to )ondon on 9 Buly 8098.
Malaysia %irlines introduced double daily %irbus %3@0 flights on the )ondon route on 8:
*ovember 8098" ;aris route is effective daily from 9 March 8093 and Hong 6ong route on 9
May 8093.
Co0eshare aree4ents
Malaysia %irlines has codeshare agreements with the following airlines3
%ir Mauritius
%merican %irlines
<ang#o# %irways
>athay ;acific
>hina 'outhern %irlines
&ragonair
Egyptair
Ethiopian %irlines
Etihad %irways
(innair
(irefly
7aruda !ndonesia
7ulf %ir
Bapan %irlines
Bet %irways
6)M
6orean %ir
Myanmar %irways !nternational
+man %ir
;hilippine %irlines
Gatar %irways
Royal <runei %irlines
Royal Bordanian
'il#%ir
'ingapore %irlines
'ri)an#an %irlines
.hai %irways !nternational
.ur#ish %irlines
F1be#istan %irways
% Malaysia %irlines %irbus %3@0" the flagship carrier of the airline.
Malaysia %irlines %irbus %3305300" used primarily for the medium5long haul routes.
% Malaysia %irlines <oeing 7775800ER" mainly deployed for the medium and long haul
operations.
Malaysia %irlines <oeing 7375@00" the regional wor#horse fleet.
%s of March 809:" Malaysia %irlines operates the following aircraft3
Malaysia Airlines /leet
Air%ra1t
In
Servi%e
Or0ersA
Options
Passeners
Notes
/ C Y Total
%irbus %3305
300
94 0K#$ 0 3I 8:7 8@3
%ll with *ew ;roduct (eatures
consistent with
%irbus %3@0 and <oeing 7375
@00,MP-",M'-
%irbus %3@05
@00
I S @ II :80 :D:
T4@U
<oeing 7375
:00
99 S 0 9I 98@ 9:: <eing phased out.
<oeing 7375
@00
94 S 0 9I 940 9II )eased ,M)-,((-
37 9:K#$ 0 9I 9:: 9I0 Replacement of 7375:00
<oeing 7775
800ER
9: S 0 34 8:7 8@8
.o be phased out" replacement to be
decided in 809:. +ne missing.
MAS Caro /leet
%irbus %3305
800(
: S *K%
<oeing 7:75
:00(
8 S *K%
Total +"B +BA-"
Services Provided By The Company
Servi%es
Malaysia %irlines operates a fleet of aircraft with two5cabin and three5cabin configurations.
.he 7775800 fleet has a two5cabin configuration" with 7olden >lub >lass and Economy
>lass. .he %irbus %3@0 fleet has a three5cabin configuration" also including (irst >lass. .he
%irbus %3305300" <oeing 7375@00 and <oeing 7375:00 aircraft have a two5cabin
configuration.
Air(ort lo2ne
Malaysia %irlines= 7olden )ounge
.he 7olden )ounge is the airport lounge for Malaysia %irlines %irst Class" &olden Club
Class passengers and 'nri(h Platinum and 'nri(h &old" eligible +neworld and code5share
partner members. .he clubs all have open bars and food catering. .here are 9: lounges
throughout the world" and /ualified passengers have full reciprocal privileges at lounges
operated by selected partners. .he lounge offers various services such as business centres"
food catering" slumber rooms and child5care centres.
T4DU
)ounges are maintained at the following airports3
6uala )umpur
6ota 6inabalu
6uching
)ondon
Melbourne
;enang
;erth
'ingapore
'ydney
!n %pril 800@" the airline launched its new Regional 7olden )ounge at the 6) !nternational
%irport ,6)!%- for regional5bound first and business class passengers. $ith this new lounge"
Malaysia %irlines at 6uala )umpur !nternational %irport now has three lounges3 the 'atellite
)ounge" &omestic )ounge and the Regional )ounge.
Ca3in
%ll of Malaysia %irlines= aircraft have an Economy and a <usiness >lass section. (irst >lass
is only present on %irbus %3@0 aircraft. <abies are banned from first class.
First Class
(irst >lass is offered only on the %irbus %3@0 on routes to Hong 6ong !nternational %irport"
)ondon Heathrow and ;aris >harles de 7aulle. Malaysia %irlines offers the widest (irst
>lass seats in the s#y on its %3@0 aircraftJ the %3@0 features eight semi5enclosed suites with a
835inch flat screen television.
Business Class
)usiness Class (*reiously known as &olden Club Class) is aailable on all o+ Malaysia
Airlines, +leet- The newer business (lass. introdu(ed in /$$0. (an only be +ound on
Boeing 777-2. whi(h has 10 seats-
!n 8099" Malaysia %irlines introduced the new business class seats on their brand new %irbus
%3305300. $hile newer regional business class seats were also introduced on the <oeing
7375@00 to be used on short5medium haul routes such as 6ota 6inabalu" .aipei and Manila.
TI9U
'eats made by Recaro within the <usiness >lass cabin of new %3305300 are configured in
pairs ,85858- layout" fitted with in5seat power and F'< port" as well as new 'elect 3000i on a
94.: inches touch screen panel" while the <oeing 7375@00 are fitted in pairs ,858- inclusive of
the new 'elect 3000i and have recline ability. .he first %irbus %3305300 carrying the new
Regional <usiness >lass was assigned to 6uala )umpur 5 <risbane sector on 80 %pril 8099.
TI8U
Economy Class
Economy >lass is available on all of Malaysia %irlines= fleet. 'eats feature a pitch of 335
3: inches and width of 97597.84 inches" with footrests ,ecept on 7375:00s- on the older
aircraft while the newer fleets such as the %irbus %3@0" %irbus %3305300 and <oeing 7375
@00 feature seat pitch of 30538 inches and width of 97597.4 inches. +n the <oeing 7775800" it
has a I.4E personal .H located behind each seat" and a footrest located below the seat in
front" the leased 7375@00 has no personal .H but overhead .H=s located in the aisles of the
plane and feature a seat pitch of 8D530 inches. .he new %3305300 as well as the new 7375@00
all have the new 'elect 3000i. .he <oeing 7375:00 has a standard Economy seat. !n 8090"
Economy >lass was voted the 2orld,s )est '(onomy Class at the /$#$ 2orld Airline Awards
by '#ytra.
!Ba"y "an! and !C#ild-$ree %one
Malaysia %irlines has attracted both criticism and praise for its controversial decision to
prohibit children from travelling in certain classes or cabins of its aircraft.
!nfants are not permitted in first class on M%' %irbus %3@0 due to M%'= decision not to
install bassinets in the cabin. Malaysia %irlines Managing &irector and >E+ .eng#u %1mil
eplained the policy in a .witter post" saying the airline received complaints from first class
passengers that they Espend money on 9st class and can=t sleep due to crying infantsE.
M%' subse/uently claimed that an upgrade of the first class cabin to fit new seats and an
ottoman ,which doubles as a visitor seat- meant Ethere was no facility for positioning
bassinets in the (irst >lass of the 7:7s.E However" %1mil later said it was possible for M%'
to fit bassinets to the first class sections of its 7:75:00s Ebut many people complain about it.E
Malaysia %irlines has also stated that children under the age of 98 may not travel in the 705
seat upper dec# economy section of the %3@0. E.he economy seats on upper level will be
allocated for business travellers. ;assengers accompanying children under 98 years old age
will be ecluded from boo#ing these seats.E
M%' says the decision Eis to showcase the economy class 1one in the main dec#" enhanced
and designated as a family and children friendly in flight 1one. (rom the perspective of
customers travelling with their families" the economy class family5friendly convenience
would be a warm welcome. .he main dec# has more facilities such as toilets ,@ for economy
configuration of 340 seats- and the dual aerobridge airport facility supporting this dec# will
also mean a speedierKfaster embar#ation and disembar#ation for this group of passengers.E
In&1liht entertain4ent
Sele(t is the in5flight entertainment system of Malaysia %irlines. .here are three types of
Sele(t3 Sele(t 1$$$i" Sele(t 1$$$i Portable Media Player and Sele(t Mains(reen. However"
the <oeing 7375:00 does not have 'elect Mainscreen or either version of 'elect 3000i" and
does not offer audio video on demand.
Sele%t ?"""i
%ll Malaysia %irlines %irbus %3@0" %irbus %3305300,*E$-" <oeing 7375@00 and
7775800ER aircraft are e/uipped with an !n flight entertainment system" Sele(t 1$$$i
with audio and video in 9: laungages. % touch5screen personal .H is available on
board %irbus %3@0" %irbus %3305300,*E$-" <oeing 7375@00 and (irst >lass and
<usiness >lass on <oeing 7775800ER aircraft.
*ew deliveries of %irbus %3305300,*E$- and <oeing 7375@00 ,MP"M'- aircraft
would carry touch5screen based 'elect 3000i.
'elect 3000i ;ortable Media ;layer
Sele%t ?"""i Porta3le Me0ia Player
.he Sele(t 1$$$i ;ortable Media ;layer is provided to Malaysia %irlines= <usiness
>lass passengers on selected regional and semi5long5haul <oeing 7375@00 ,M)-
aircraft on *orth and 'outh %sia routes. !t allows passengers a choice of movies" .H
shows and sports.

Sele%t Mains%reen
Fsed in Economy >lass on <oeing 7375@00 ,M)- regional and semi5long5haul
aircraft which features 945inch dropdown retractable )>& screens are installed at
every :th seat row in the economy class 1one of the aircraft.
Malaysia %irlines= inflight maga1ine is named =7oing ;laces= and is available both on board"
and as a freely downloadable application for %pple=s i;ad.
/re>2ent&1lyer (rora4s
Malaysia %irlines has two fre/uent5flyer programs3 7rads for 'tudents by Malaysia %irlines
,7rads- and Enrich by Malaysia %irlines ,Enrich-. 7rads is a fre/uent5flyer program with
benefits designed for students. Enrich by Malaysia %irlines is a fre/uent flyer program for
fre/uent travellers that comprises a variety of airlines" ban#s" credit5card issuers" hotels and
retailers around the world.
Enri%h 3y Malaysia Airlines
+n 30 'eptember 9D@7" Malaysian %irline 'ystem introduced the 'steemed Traeller
fre/uent5flyer program. !n the early 9DD0s" Malaysia %irlines" >athay ;acific" .hai %irways
!nternational and 'ingapore %irlines launched their 2oint %sian fre/uent5flyer program3
;assages. .he 2oint program was officially dissolved in 9DDD" and the Enrich fre/uent5flyer
program made its debut after the split from ;assages.
Enhanced Enrich
+n 98 Buly 800I" Malaysia %irlines introduced its enhanced Enrich fre/uent5flyer
program. .he program is now #nown as Enrich by Malaysia %irlines ,Enrich-.
Member
<enefits and .iers
.here are four levels of Enrich memberships 5 <lue" 'ilver ,oneworld Ruby-" 7old
,oneworld 'apphire- and ;latinum ,oneworld Emerald-. Each offers various privileges
including priority chec#5in" priority standby and etra baggage allowance" amongst
others. Miles can be accrued on /ualifying Malaysia %irlines services" as well through
partners" including airlines" hotels" car rental agencies and credit5card companies.
Miles accrued by members allow for redemption for free travel" free upgrades and
other complimentary services.
;artners
Members of Enrich are able to accrue miles on /ualifying flights through Malaysia
%irlines and Enrich airline partners3
+neworld %lliance airline partners ,effective 9 (ebruary 8093-
%ir (rance" %litalia" &elta %ir )ines" Etihad %irways" Bet %irways" 6)M" 'ri)an#an
%irlines" Hirgin %tlantic" (irefly
*on5airline partners include3
Hilton Hotels >orporation" !nter>ontinental Hotels 7roup" %vis Rent a >ar 'ystem"
.he Hert1 >orporation
8ra0s
7rads for 'tudents
7R%&' is Malaysia %irlines= fre/uent5flyer program for students above 98 years old.
/2t2re Pros(e%t
Deliverin Val2e /or Money
.he term V(ive 'tar Halue >arrier con2ures an image of an airline that comes first to mind
when customers see# /uality air travel and real value5for5money. This is an airline that
*eo*le go out o+ their way to +ly with and to re(ommend to their +riends be(ause the airline
understands what they 3'ALL4 N''5 (not what the airline thinks they need) and does its
best to meet these needs- .his way" there is no unnecessary cost and therefore" fares
can remain low and competitive. $e will offer *rodu(ts and seri(es that provide our
customers with more alue (om*ared to those o+ our (om*etitors- +ur target customers are
those who want service ecellence and /uality" and do not ma#e decisions solely on price.
.heir reasons for flying with us could revolve around connectivity" inflight service" seat
comfort and a host of other reasons. .his means that we will not always compete directly
with the lowest fares offered by the )>>s or other full service carriers. +ur aim will be to
have a yield premium that is above the lowest priced competitor on our routes.
%t the same time" we will place a lot of emphasis on deliering alue +or money as we #now
that price is still an important consideration for many. .hus" we aim to offer very
competitively priced tic#ets in all classes. &elivering value will re/uire us to improve our
customer service and increase the efficiency and productivity of our behind5the5scenes
infrastructure. .his then needs to be matched with appropriate choices about how and
where we spend on product development and ensuring that there is a clear Return +n
!nvestment ,R+!- on every ringgit spent.
Meals Satis1a%tion
% second eample is the introduction of the )ight Meal <o ,)M<- on selected routes. $hen
we scanned the industry" we realised that many European and %sian carriers have introduced
light meal boes. $hen we launched ours" we did a survey based on 3@3 flights ,34"000
passengers-. .he findings showed that D9M found our light meal boes acceptable" 4M
complimented them and only a small group i.e. 3M did not li#e them. .he meal boes
have enabled us to increase inflight service efficiency" improve aircraft turnaround time" and
reduce our overall inflight costs.
/LYIN8 TO WIN C7STOMERS
.he ('H> that we envisage will have strong and sustainable revenue streams. .hese will be
earned through winning customers who believe in our brand and want to fly with us R
#nowing that we provide an affordable" yet high /uality travel eperience. %s long as we
relentlessly #eep our costs low" we are able to offer competitive fares to a wider range of
customer segments" and en2oy a virtuous cycle of #eeping eisting loyal customers and
attracting new ones. $e will construct a focused commercial platform that consistently wins
in the mar#etplace. $e will build a mar#et5facing capability by being an agile organisation
that allows us to out manoeuvre our peers in the mar#ets in which we choose to compete.
>ustomers will choose M%' because of its products and services" flight timings" prices and
promotions" not because it is the only game in town. (or M%' to (ly to $in customers" we
will fundamentally ma#e the following changes3
/ro4 C3ran0 e>2ity tie0 to national i0entityD to C3ran0 loyalty 32ilt on 0eliverin tr2e
Malaysian Hos(itality at a11or0a3le >2alityD
$e proudly carry our nations name and we have to understand and live up to what that name
embodies. <eyond the mere fact that we are Malaysias national carrier" our name represents
a brand promise we ma#e to our customers i.e. that M%' will always deliver an affordable"
/uality offering to our customers. .hat we will do so in true Malaysian Hospitality R treating
our customers as our guests and family. .hat we provide a hassle5free service and ta#e care of
our customers all the way. .his is the essence of our brand. !t is the embodiment of what we
see# to do with our ('H> strategy R sincere" /uality service that always ma#es our customers
feel welcome" delivering what they need" when they need it" with minimum fuss.
+ur competitiveness has to be built on establishing a following of loyal customers. Hence"
the fundamental change we have to ma#e is to move from a traditional price driven mar#eting
approach into one that is brand and customer loyalty driven. .o be clear" we are not pursuing
this ('H> strategy with the intention of buying customer loyalty through cheap fares. $e
#now that we will need to earn our customers loyalty by always delivering what they want R
/uality at the right price" tetured deeply with Malaysian Hospitality" throughout their
2ourney.
/ro4 C32siness&1o%2se0D to Cleis2re&1o%2se0 an0 32siness&intereste0D
+ur recent investments in large aircraft with low seat5density and top5range products
implicitly suggest a focus on large" business point5to5point connecting flows. .he reality is
that Malaysias premium traffic to and from Malaysia is too small to ma#e this strategy
profitable. (or eample" the European business traffic to and from Malaysia is less than half
of that to and from either 'ingapore or Hong 6ong. 7iven our eisting fleet and mar#et
realities" we must increase our competitiveness in the #ey connecting flows and focus on
leisure traffic ,see Ehibit E:-. !t will mean that we recognise our competitiveness in the
leisure segment will emerge as the #ey driver of our profitability. $e will fly only where
there are large" attractive flows of leisure customers. .his does not mean that we will
compromise the /uality of our business offering. +n the contrary" we will maintain and
improve the /uality of these products over time. +ur premium cabins will provide
us with much needed =gravy=" but on their own" they will not sustain our profitable growth.
/ro4 C(re4i24 1ares Eith a 1iFe0 (a%9ae o1 servi%esD to Ca11or0a3le 1ares Eith a
stan0ar0 (a%9ae an0 1ees 1or o(tional servi%esD
.o deliver value to our customers" we will need to match our prices to the needs and demands
of the mar#et. !n domestic and %'E%* mar#ets" we will price the ma2ority of our fares in the
Economy cabin within an affordable range. $ith such fares" we will be etremely
competitive and target to maimise many new sources of traffic. Regardless of whether the
traffic is from >hina" !ndonesia or !ndia" we will be well positioned to capture the strong
traffic flow demand driven by the growth of these economies. +ur business model will shift
from one of trying to protect yield and mar#et share against )>> erosion into one that
leverages on low fares to optimise new growth opportunities and mar#et positions. $ith the
stimulation effect of our lower fares" we aspire to fly more than 84 million passengers by
8094. Even as we lower our fares to offer value pricing" we will develop new alternative
revenue sources to rebuild our yield losses. +ur revenue generation will have to shift from a
fied pac#age of services differentiated by fare policies into standard pac#ages with optional
fee5based services. $e will introduce value5added services such as travel insurance as well as
other products and services that will be developed or made available through partnerships.
+ur customers will benefit from the fact that they now have a choice of whether they want to
pay for selected services" rather than having to buy a single fied pac#age. .his will enhance
our yield.
/ro4 Cina((ro(riately %on1i2re0 1leetD to Ctihtly&4at%he0 1leet that 4eets o2r nee0s
an0 %o44an0s (re4i24D
7etting our product and fleet configuration right is one of the single most important levers for
our cost transformation. %mongst ma2or carriers for long5haul" M%' has the widest seat pitch
in our Economy cabin. $e have also generously configured cabins that overly consume space
for non5revenue generating usage" such as the galley. <ased on industry observation ,see
Ehibit E4-" beyond a threshold comfort level" customers are not willing to pay a premium
price for these etras as they do not value it highly. !nstead" we need to direct our space
allocation towards increasing density so that we can reduce our cost per seat and
conse/uently" offer lower and more competitive fares. .he savings on cost per seat can be
reinvested to ensure that we are providing our customers what they value" i.e. a better inflight
eperience through innovative inflight entertainment systems. %merican %irlines widely
publicised their wider seat pitch as a selling point" with the slogan" Vmore room throughout
coach. However" they were not able to command higher fares than their competitors ,with
high seat density-. % few years later" they abandoned this program completely and
ac#nowledged that the leisure mar#et they served would not pay for the wider seats. .he
98"000 additional seats released enabled them to increase revenues by an additional F'&900
million per year. 'ource3 !ndustry Reports
+ur fleet is currently not best matched with the routes we deploy them on. >onse/uently" we
either incur higher costs than competitors andKor become operationally constrained in how
we serve our customers" e.g. limited range. .o win in the leisure5focused" business5interested
space" we will increase the density in Economy cabins and decrease the si1e of premium
cabins. !n our fleet renewal eercise" we aim to move our fleet towards having aircraft that
are more agile and fuel efficient. .his will allow us to provide higher fre/uency to those
destinations that we choose to serve.
/ro4 Chih 0istri32tion %ostsD to CloEer 0istri32tion %osts via reater 2sae o1 0ire%t
%hannels an0 Internet 0istri32tionD
&istributing our tic#ets is integral to how we serve our customers. +n average" 7&'
distribution costs constitute up to 8.4M 5 3M of an airlines total costs and it is easily one of
the top 4 cost items on the ;?). Many airlines are moving towards !nternet distribution to
reduce their distribution cost. %er )ingus" for eample" went from 3M to 74M !nternet
penetration in 8 years. %ir >anada went from 90M to 40M in the same timeframe" with no
price differential as a result. !t will be important that M%' positions itself well in direct
channels" particularly the !nternet. $e target to achieve 40M5I0M !nternet penetration by
8090. More efficient and effective use of such channels will allow us to serve our customers
better. !n line with our MH value proposition" we plan to reduce the usage of paper tic#ets"
save our customers time and provide greater transparency on our inventory. %ll these
ultimately lead to better value and lower costs to customers" and in turn" for us too.
MASTERIN8 OPERATIONAL EGCELLENCE
.he situation of overcapacity" early liberalisation of %'E%* s#ies and proliferation of low5
cost carriers will lead to erosion of prices and margin. .o remain a #ey player" we need to
become more competitive. <efore we can offer more competitive fares" we need a cost base
that is very low. .his is the only way that M%' can strategically differentiate itself in the
region and defend its mar#et share. $e target to structurally reduce our systemwide unit costs
,>%'6- by 80M from the current 9@ senK%'6 down to 9:.4 senK%'6. .his must come from
stronger cost controls" better asset utilisation" improved labour productivity" and more
efficient processes. Many have as#ed whether it is possible to maintain 45'tar service while
reducing costs. .he answer is VLesW .his re/uires a shift in mindset. (rom the current cost
structure with comple full services" towards an aggressively stripped down cost structure
with 1ero tolerance for non value5added costs. .his means each service5related cost will have
to be scrutinised and value5tested against what customers will pay for. !tems that
customers are not willing to pay for include inefficient usage of assets" wastage in wor#
processes and productsKservice features that customers do not value highly.
/ro4 C(ro%2rin 3ase0 on ratin&0riven (ro02%t o11erinD to Ctailore0 (ro%2re4ent
eFa%tly 4eetin %2sto4ersD nee0sD
+ur product offerings determine a large part of our costs. Ranging from the whole catering
supply costs through to inflight entertainment services" many areas of our costs are
determined by the decisions we ma#e in what product offerings our customers want and will
pay for. .he impact can be etremely significant. .he fundamental change we need to ma#e
is to be willing to focus and ma#e trade5offs in our product offerings.
<y understanding what our #ey customers really want" we need to focus ruthlessly on
delivering 2ust that at the right cost5value trade5off. $e will not be able to structurally reduce
costs while giving all customer segments everything that they say they want. $e will build a
supplier base that is aligned to our aspirations and well integrated with our operations. .hey
should be willing to partner us to see# continuous improvements that is mutually beneficial.
'uppliers who subscribe to M%' aspiration will stand to benefit from our business growth
and remain our preferred partners.
/ro4 C4i00le&o1&rane air%ra1t 2tilisationD to Clea0in&e0e air%ra1t 2tilisationD
+ur aircraft and flight crews ma#e up a large part of our revenue generating assets. .he
productivity of our aircraft" measured by their utilisation" is therefore of great importance to
our profitability. Revising our schedules by reducing turnaround times to increase utilisation
of our aircraft could lead to significant savings. !n 8007" with our <oeing 737 fleet" for
eample" we reduced the aircraft turnaround time by 4 minutes and we were able to free up 9
aircraft which we used to mount an additional @ flights per day. Multiply this by 3:4 days a
year ,assuming 80 days are put aside for aircraft maintenance chec#s-" this wor#s out to an
additional 8"D00 flights and resultant additional revenue. :I <eyond cost5savings" improving
fleet utilisation has other important #noc#5on effects. <y freeing up additional
capacity on a given fleet si1e" we can deploy the aircraft to grow our business on strategically
important routes and with new customer groups" enabling us to capture our full growth
potential. .he fundamental shift we have to ma#e is to ta#e a holistic view of the cost of our
inventory" from commercial re/uirements through to operational goals" to fully optimise our
assets. .his could mean relaing the time constraints around which our flights can depart or
arrive in a day or twea#ing the gap between flights on an individual airplane. $e aim to
improve our fleet utilisation by 90M580M.
/ro4 CloE (ro02%tivity an0 la%9 o1 o(erational (lanninD to Chih (ro02%tivity an0
Eorl0&%lass lean airlineD
$hile we benefit from operating in a low labour cost environment" comparison of our
productivity against other carriers indicate that we have room for improvement. $e will need
to be leaner to reach our goal of increasing employee productivity. 'tripping out
inefficiencies in our processes is something we can achieve easily as it will
not adversely affect our customer value proposition. Rather" it will enhance our value offering
and our competitive position. <y adopting lean practices in our daily wor# R from mar#eting
and selling our products and services and operations on the ground to activities in the air R we
will transform into a distinctive ('H>.
/ro4 Chihly varia3le o(erationsD to C(re%ise loE&error o(erationsD
%s we grow" we will deliver more consistency and precision. 'ervice delivery must be
consistently good and meet customers epectations. !n order to achieve this" it is etremely
important that everyone in M%' pays attention to details and does the ordinary things"
etraordinarily well. Everything we do will be on time" according to specifications and cost.
$e will reflect this precision in our operating performance" i.e. better on5time arrivals" fewer
lost bags and also in our customer eperience" i.e. shorter /ueues" greater consistency. $e
will treat every tas#" from selling a tic#et to a customer and chec#ing in a passenger to
unloading a bag" with the same determined discipline. +ur goal is to eliminate wastage"
variability and error.
/ro4 CsloE %los2re on sa1ety iss2esD to Ci44e0iate attention an0 ra(i0 %los2re on sa1ety
iss2esD
'afety is our licence to operate the airline and it is the responsibility of every single employee
in M%'. $e will never compromise on safety. +ur safety record thus far has been good but
we cannot be complacent. 7oing forward" we will intensify our attention on any safety issues"
however small" that appears on our radar and we will endeavour to close the safety
issuesKgaps within the stipulated time. $e will wor# together through the 'afety Management
'ystem framewor# and continually see# opportunities to improve. &iscipline of action in the
area of safety is of utmost importance. $e will focus on developing this habit in our 2ourney
to build a strong and sustainable safety culture across the company.
/INANCIN8 AND ALI8NIN8 THE B7SINESS TO PHL
.o sustain any industry cyclical shoc#s R whether it is shoc# from rising fuel prices or the
increasing presence of )>>s RR we need to move from Vfighting to stay afloat to Vbeing well5
prepared for future storms. .his will ensure the progressive development of our finance
capabilities in line with our <usiness .ransformation ;lan.
/ro4 Cin%re4ental %ost savins taretsD to Cstr2%t2ral %ost re02%tion taretsD
.raditional cost5saving measures will not be sufficient to help us achieve our new vision of
structural" brea#through" non5incremental cost5savings. % brea# in the mindset shift is
re/uired to ensure that we wor# cohesively as one" single5minded team. .he big opportunities
lie in cross5functional interactions which are connected to overarching decisions about
changing the business model. $e will develop clear targets with both top5down and bottom5
up analytical support to ensure upfront buy5in and effective eecution.
/ro4 =1o%2se0 on i4ae= to =1o%2se0 on (ro1it=
+ur decisions must be anchored on profitability 5 not political favour" false imagery" #eeping
up with the latest aircraft and technologies or individualised glory in the international
community. !f it does not help us ma#e more money" we will not do it. .o achieve this" we
will re5focus on routes" businesses and activities where we can ma#e money. !f we need to"
we will shrin#" as we will limit our reach to where we can win. $e will ma#e every effort to
transform each part of our business and we simply will not operate where we cannot ma#e
money. $e will set up mandatory monthly review meetings in departments" with clear
agendas and processes to ensure the productivity level of these meetings. $e will review
6;!s for each department and revise them as necessary to ensure they are fair and relevant.
;erformance against targets will be transparently reported and challenged every month by the
Managing &irector and the M%' management team. %ny shortfalls will be scrutinised
immediately and early corrective action will be ta#en.
/ro4 C0e%entralise0 4onitorin o1 o(erational (er1or4an%eD to Cinterate0 4onitorin
o1 PHL (er1or4an%eD
Historically" M%' practices decentralised monitoring of operational performance. $hile this
is important" it is not enough. >ommercial and +perations functions have been focusing
mainly on meeting their respective divisional 6;!s and handling Vlocalised fire5fighting
matters. However" this Vsilo behaviour in the organisation ,which may ensure that the
interests of respective divisions or departments are ta#en care of- does not contribute
positively to the bigger picture at corporate level. % significant portion of the cost base is tied
up in the friction that eists between the >ommercial and +perations functions. Eliminating
that friction is not as simple as as#ing managers to wor# together" but is critical to how M%'
transforms into a ('H>. .he M%' management team are now made 2ointly accountable for
the corporate scorecard. .he ;?) targets are decomposed into divisional and departmental
levels so that headsKmanagers of various functions also share the accountability for specific
financial targets" on top of their usual operational targets. .hese headsKmanagers will be
e/uipped with clear processes" information flows and new analytical tools to ensure
standardisation and integration. <ecause of this integrated approach" various functions are
inter5dependent on each other to meet their 6;!s and hence" cross5functional collaboration is
not negotiable. !t is a must.
7NLEASHIN8 TALENTS AND CAPABILITIES
$e can only realise the ('H> dream if we pull together as one team. ;articipation from
every one in M%' is crucial. .he employees of M%' represent our most important asset. $e
need to unleash the hidden talents in the company" developing leaders in everyone" and this
will be the greatest source of profitability. %s we tal# to our employees and managers" we
consistently see passion" energy and drive. !n this thrust" we will ma#e fundamental changes
to our wor#ing environment so that we can harness and direct this passion and drive to
ensure that our people succeed at various levels.
/ro4 CMAS (eo(leD to CMAS lea0ersD
$e will move empowerment down the line" developing leadership s#ills in everyone" and
create a pool of future leaders who will continue to carry the torch of M%' transformation.
$e do not want Vadministrators to ta#e up leadership positions. $e want only leaders R
people who assume leadership roles and lead initiatives to deliver brea#through performance
such as turning around an unprofitable route" substantially increasing yield" dramatically
improving on5time performance" or significantly improving fuel efficiency. $e pri1e such
leadership attribute in our employees. .here could be such leaders at every level in M%'
today" and we will create the right environment for these eceptional talents to step up and
deliver brea#through results" regardless of their seniority" education or bac#ground.
Fnder our new talent management framewor#" we have put in place a structured programme
to develop future leaders. $e will identify future leaders early and through succession
planning. (or every critical leadership position" 3 successors have been identified" each with a
personalised training and developmental plan. $e will help these future leaders achieve their
full potential with fre/uent reviews and tailor5made trainings" e.g. %irline <usiness >ourse"
.ransformational )eadership &evelopment ;rogram" etc. .he aspiration is to ensure these
future leaders are well5e/uipped with the right mindset and leadership behaviors" and
groomed to grow and achieve their full potential.
/ro4 Centitle4ent %2lt2reD to Creal a%%o2nta3ility an0 (er1or4an%e %2lt2reD
$e need to brea# the legacy mindset and Ventitlement culture that is attached to the national
carrier. $e will ensure that all employees are fully accountable for not 2ust their tas#s but
more importantly" for the ultimate outcomes and benefits to M%'. $e will generously and
immediately reward those who perform and success must be celebrated" without 2ealousy. +n
the other hand" we will as# those who do not perform to leave. M%' will no longer be merely
a nice place to wor# with a V2ob for life" but one that is intense and dynamic and where only
performance" high values and integrity matter.
/ro4 CsilosD to C%ross&12n%tional tea4Eor9D
'ilos are typical in comple networ# businesses li#e M%'" where most decisions involve the
input of many functions. <ut a silo culture is also the reason why many airlines fail. $e will
wor# increasingly in cross5functional teams and hold people accountable for cross5functional
results. (or eample" we will hold people accountable for route profitabilityRan opportunity
that cuts across the 'ales" ;ricing" *etwor# and +perations functions.
/ro4 Co(a>2enessD to Ctrans(aren%yD
$e will be transparent with our people. !n turn" our people must behave with real integrity"
respect company confidentiality and be transparent in their interactions with each other and
our sta#eholders.
WINNIN8 COALITIONS
$e #now that we cannot achieve our goals alone. M%' needs the resolute support of its
customers" employees" partners" suppliers" agents" investors and government. $e need to
build winning partnerships to grow and sustain profits in this industry. .his thrust is focused
on fundamentally transforming how we wor# with sta#eholders to ensure that national and
community needs are met while still providing M%' with the room re/uired to operate
profitably.
/ro4 =1lyin solo= to =Einnin (artnershi(s=
$e will cooperate more closely with other airlines ,through sharing of engineering and
maintenance facilities" forming alliances" etc- and with Malaysian business partners ,through
2oint loyalty programmes with other 7overnment5)in#ed >ompanies etc.
/ro4 Crea%tiveD to C(roa%tive enae4ent Eith sta9ehol0ersD
$e will proactively share with all our sta#eholders our results" issues" plans" what we do and
why. $e will also insist that all our sta#eholders do the same for us.
INTERPRETATION O/ RATIO ANALYSIS /OR MAS AIRLINES BHD
!n the ratio we can see the highest gross profit margin ratio is in 8090 ,4.:M- and gross for
8099 is the lowest by ,50.08M-. (or the profit margin ratio the highest is in 8090 by ,@.D@M-
and the lowest in 8099 by , 597.9:M-. R+>E in 8099 is the highest by ,:7M- compare to
8090. %s conclusion we can say that the performance of company profit is decrease in 8099
but growth bac# in 8098. .his because maybe effect from the less customer spending on
M%' flight tic#et. Maybe M%' flight tic#et is more epensive compare to others airlines
company. .he net profit ratio is the overall measure of the firms ability to turn each of
income from services in net profit. !f the net margin is inade/uate the firm will fail to achieve
return on shareholders funds. High net profit ratio will help the firm service in the fall of
income from services" rise in cost of production or declining demand. .he net profit is
decreased because the income from services is decreased. .he increment resulted a slight
decrease in 8099 ratio compared with the year 8090
Fnder efficiency ratio we 2ust analyse two ratios (ied %sset .urnover and !nventory
.urnover. (rom the table we can see the best turnover is in 8090 compare with others year.
$e can conclude that !ncome from services is greatly increased due to the etra invoice for
+perations ? Maintenance fee and the wor#ing capital is also increased greater due to the
increase in from services because the huge increase in current assets. .he income from
services is raised and the current assets are also raised together resulted in the decrease of the
ratio of 8099 compared with 8090.
(rom the table we can conclude that M%' current assets which are ready in the form of cash
are considered as absolute li/uid assets. Here" the cash and ban# balance and the interest on
fied assets are absolute li/uid assets. !n the year 8099" the cash and ban# balance is
decreased due to decrease in the deposits and the current liabilities are also reduced because
of the payment of dividend. .hat causes a slight increase in the current years ratio.
Earnings per share ratio are used to find out the return that the shareholders earn from their
shares. %fter charging depreciation and after payment of ta" the remaining amount will be
distributed by all the shareholders. *et profit after ta is increased due to the huge increase in
the income from services. .hat is the amount which is available to the shareholders to ta#e.
.he share capital is decrease from the year 8099. &ue to the huge increase in net profit the
earnings per share is greater increased in 8090. .he ratio is calculated to ma#e an estimate of
application in the value of share of a company. .he mar#et price per share is increased due to
the increase in the reserves ? surplus. .he earnings per share are also increased greater
compared with the last year because of increase in the net profit. 'o" the ratio is decreased
compared with the previous year.
'FMM%RL
9- %fter the analysis of (inancial 'tatements" the company status is no stable" because the *et
wor#ing capital of the company is decrease from the last years position.
8- .he company profits are huge in the current yearJ it is better to declare the dividend to
shareholders.
3- .he company is utilising the fied assets" which ma2orly help to the growth of the
organisation. .he company should maintain that perfectly.
:- .he company fied deposits are raised from the inceptionJ it gives the other income
eample !nterest on fied deposits.

INTERPRETATION O/ RATIO ANALYSIS /OR AIRASIA BHD
Revenue growth Lear 8090 Lear 8099 Revenue growth ,M- 8I.08 93.@I Revenue growth
<ased on trend analysis on revenue growth of %ir %sia" it shows a drop from year
8090,8I.08M- to 8099,93.@IM-. %lthough %ir %sia recorded higher net revenue in year 8099
compare with 8090" however the huge drop of revenue is due to drop in ancillary income
such as etra services or product ordered by the customer of %ir %sia. +ne of the sources of
ancillary income is beverages or food ordered by passenger on board. .herefore %ir %sia can
opt to introduce more services and product for passenger to choose so that it can boost its
ancillary
R+>E Lear 800D Lear 8090 Lear 8099 Return on >apital Employed ,M- D.I3 90.I@ 99.D7
from year 800D to 8099 shows a stable continuous increase in the R+>E. .he increase of
R+>E from year to year is due to %ir %sia improved training and development therefore
leads to increase in efficiency of %ir %sias wor#er. +ther than that increase in profit form
year 800D to 8099 is also the main factor which contributes towards higher R+>E. !nvestor
who opts for a stable although low R+>E can choose to invest in %ir %sia because it provides
stable return for its investor from year 800D to 8099.
7earing Lear 800D Lear 8090 Lear 8099. 7earing ratio ,M- 7:.3@. 7earing %ccording to the
%ir %sia gearing ratio for 3 consecutive years" it shows a huge drop in gearing ratio from year
800D to 8090. .his shows that %ir %sia may have invested in the right investment and it may
also due to not purchasing huge asset as the last time %ir %sia invested in fied asset was in
year 8007 which is the purchase of <oeing 737R300. (rom year 8090 to 8099" %ir %sia also
shows slight drop in gearing ratio which shows %ir %sia is getting better in handling its
financial ris#. .his is good news for the company and investors who invest in %ir %sia
because they do not need to worry much that %ir %sia will be facing financial crisis.
>urrent Ratio Lear 800D Lear 8090 Lear 8099. (rom the result shown for current ratio from
year 800D to 8099" it shows that %ir %sia are moving toward the ideal current ratio of 839. !n
year 800D" %ir %sia will have concern of its cash flow due to poor current ratio obtained but
when it is compared with year 8090" the current ratio gets better and it shows better li/uidity
control. (rom year 8090 to 8099" it shows that %ir %sia have improve further in their
management in wor#ing capital which lead %ir %sia of having ratio of 9.73 times in year
8099 which shows that %ir %sia=s asset are improving faster than its liability.
!nterest >over Lear 800D Lear 8090 Lear 8099. !nterest >over !t is a good sign for %ir %sia to
have increased interest cover from year to year as it shows that the company is able to cover
its interest epenses more times each year. (rom year 800D to 8099 the interests cover grow
to be more stable which may be due higher growth of revenue of %ir %sia. %s the growth of
interests cover grows from year to year" investor will have higher confidence that %ir %sia
practices going concern.
%sset .urnover Lear 800D Lear 8090 Lear 8099. %sset .urnover to measure how well or
efficient %ir %sia ac/uire its asset to generate more earning" the ratio of asset turnover will be
used. %sset turnover for %ir %sia increased gradually from year 800D to 8099 and this implies
that %ir %sia have done the right choice of investing in an investment although the growth in
asset turnover have little but steady growth. .his might implies that %ir %sia prefers for a
long tern gain instead of a short tern gain. 'toc# Haluation and Ris# to measure the volatility
of stoc#" <eta ,X- is calculated. .he <eta value at mar#et benchmar# is set to be 9.0. .o
measure stoc# valuation and ris# of %ir %sia <erhad" Malaysia <ursa ,6)'E- the composite
inde is used as a benchmar#. .he sensitivity of mar#et share return is measured by beta
values. .he purpose of analysing beta value is to reduce ris# and uncertainty of mar#et return
that will affect company stoc# return. .he beta value for %ir %sia <erhad in year 8098 is
0.DI8I" falling to be less than 9.0" which mean the movement of the stoc#s are moving same
direction and very closely with the mar#et benchmar#. .his can be illustrated by the scattered
graph plotted below" that the slope of graph is positive" positive beta value indicate that the
stoc# price of %ir %sia grow corresponding to mar#et growth.
'cattered graph of %ir %sia=s annuali1ed return of investment Ris# can be measured based on
real competitions" opportunity and threats faced an organi1ation. Ris# can also be calculated
with appropriate formula" such as to use ')+;E formula in Microsoft Ecel to calculate the
ris#. (rom the beta calculated" it shown that the beta value of %ir %sia <erhad in year 8098 is
0.DI8I. 'ince %ir %sia stoc# beta is less than 9" means it has lesser price volatility than the
overall mar#et and possesses lower ris#. .he performance of %ir %sia is better than the
mar#et performances. .he lower the beta value the lower is the ris# faced by investors when
invest in the corporation. 'ince beta value of %ir %sia is slightly lower than 9" this indicates
that fluctuation of mar#et will not totally affect the company. .his could either be that both
%ir %sia has already speciali1ed in their respective industries" or company are supplying
services that demand for its service is never ending. However beta value measures historical
returns of the organi1ation to predict future returns might not be accurate. &ebt ;olicy .he
long term liability or debt is the debt which maturity eceeds than 9 year. <elow one year
debts are referred as current of short term debts. )ong term debts can be obtained either from
ban#s or by issuing bonds to the investors and then repaid to them with principal plus
nominal interest rate. .he firm having long term liabilities have various timeframe of
maturity.
!nterest rates depend on the conditions. *ow comparing the long term debt of %ir %sia
<erhad for the three consecutive years of 800D" 8090 and 8099 are MLR7303 million"
MLR79@7 million and MLR78@3 million respectively. .he graphs show that it has slightly
reduced their debt financing through the years. .he debt to e/uity ratio is higher for %ir %sia
and also the airline is not a stable industry ma#es it a bit ris#y due to its high ratios. .he high
percentage of leverage shows that despite of meagre reduction on their debts the company is
still dependent on the borrowed or owed money. (or this borrowed money they have to pay
huge amount interest on its principal amount that is cause of lifting its leverage ratios up. .he
current yield of the bond only indicates the profit or yield on the respected bond for the
current period of time. !t has no association with the whole return of the bond through life of
the bond" while the treasury securities are li#e 1ero5coupon bonds and having maturity of one
year or less. .hey are less ris#y and they do not bear any interest but is sold at premium or
discount to generate positive yield to maturity. .he calculated current yield of %ir %sia is 7.@D
M while the treasury security rate with the same maturity is 3.978M. .he difference is
covered as treasury bills are traded at a discount from its face value. .hese rates vary with the
variation of its maturities and the nature of bonds. .he bond rating of the firm according to
M%R> is %ir %siaN. .his rating means that the obligator i5e %ir %sia has very strong ability
to overcome its financial obligations. .he companys debt strength relies on the low cost
carriers with large number of their customers aiding more to their value" high fleet si1e" the
factor of vigorous load and having compact profile of li/uidity ,M%R>-. .he high debt
ran#ing is due to timely payment to their debtors with the interest rate mentioned and high
turnover of their receivables. %part from that the company en2oys about 9@0 airbuses that
serve around the globe with 70 locations. .hey have successfully applied their low cost
strategy through effective management and focus on the low cost operating procedures in
order to target the larger segment of the society. .he stated rating only imitates M%R>s
confirmation on the financial organi1ation rating of the sponsor" 6uwait (inance House
,Malaysia- <erhad ,6(HM<-. .he full details of their ratings are provided on *ovember 83"
8098.
'ummary .he %ir %sias financial performance is getting better day by day from year 800D to
8099 as there is increase in revenue growth" current ratio" R+>E" asset turnover and interest
cover. .here is also reduction in gearing ratio" noting that %ir %sia is able to ac/uire assets
without financial ris#. .he financial position of %ir %sia is etremely attractive to investors.
!nvestors are loo#ing at how much return their stoc# would able to generate to cover the ris#s
,in percentage- in the financial mar#et. !nvestors can analyse the ris# of investing in %ir %sia
as the beta value calculated to be 0.DI8I. .he higher rate of beta value" the higher the
epectation of investors. .his indicates that when Malaysia stoc# mar#et goes up 90M" %ir
%sia stoc# mar#et goes up D.IM. 'ince it=s beta value is below 9" investing in %ir %sia is
considered low ris#. .here is still D.IM of ris# that investors would ma#e a loss particularly
when the mar#et stoc# goes down" close and constant monitor of internal and eternal
environment of %ir %sia is very helpful in preventing facing those uncontrollable and
unforeseeable hit and sudden change happen in the future. .able 7 is the '$+. analysis of
%ir %sia. 'trengths $ea#nesses 5operation at low cost 5'ervice resource is limited by lower
costs 5lesser management level" effective" focused 5 secondary airports is less attractive "
giving a and perception of a second class image aggressive management +pportunities
.hreats 5+ngoing industry consolidation has opened 5!ncrease in operation cost in producing
value up prospects for new routes and airport deals added services 5&ifferentiation from
traditional )>> model 5%ccident" terrorist attac#" and disaster and by adding customer
services or operation as affect full service airline with low fare customer confidence .able 73
'$+. of %ir %sia .he utili1ation and implication of proper" accurate and precise
technologies and strategies will be able to provide and allow the %ir %sia some chances to
improve their traditional marginal profit to substantial profit li#e what Ryanair has been
achieving and maintaining. .he root driving forces in %ir %sia would be the uncontrollable
and unpredictable ever changing eternal environment li#e the political situation and
economy performance globally.
CONCL7SION
As a %on%l2sion o2r ro2( 0e%isions %hoose Airasia Bh0 is the 3est %o4(any to ta9eover.
.he companys overall position is at a good position. ;articularly the current years position
is well due to raise in the profit level from the last year position. !t is better for the
organi1ation to diversify the funds to different sectors in the present mar#et scenario.