MAHB reports profitable first nine months of 2009

MAHB Group financial performance

MYR'000	9m 2009	9m 2008	Y-o-Y
Revenue	1,160,250	1,080,055	7.4%
EBITDA	450,574	440,107	2.4%
PBT	322,065	326,929	-1.5%
Net Profit (loss)	237,155	248,221	-4.5%
EBITDA Margin (%)	38.8%	40.8%	-1.9%
PBT Margin (%)	27.8%	30.3%	-2.5%

Source: Centre for Asia Pacific Aviation & MAHB

Traffic in Malaysia is dominated by national carrier, Malaysian Airlines (MA), and local LCC, Air Asia. While MAS suffered six consecutive quarters of contracting traffic over 2008 and 1H2009, Air Asia's passenger growth has been relentlessly positive, hardly dropping below 20% over the past two years, despite the global recession.

Malaysia Airlines and AirAsia (Malaysia) passenger numbers growth: 1Q08 to 3Q09

3Q2009 was very strong across Malaysian airports, with Malaysian Airlines reporting a return to passenger growth and Air Asia continuing its double digit increases. Malaysia Airlines has also reallocated capacity from international routes onto domestic routes. MAHB saw an 11.2% increase in passenger traffic for the period.

3Q2009 MAHB passenger traffic

KL International Airport	Q3 2009	Q3 2008	% change
International	5,120,603	4,546,407	12.6%
Domestic	2,558,970	2,361,304	8.4%
Total	7,679,573	6,907,711	11.2%
Other Airports	Q3 2009	Q3 2008	% change
International	884,634	720,736	22.7%
Domestic	4,643,276	4,252,023	9.2%
Total	5,527,910	4,972,759	11.2%
Combined Total	13,207,483	11,880,470	11.2%

Source: MAHB

However, passenger traffic for the nine months to 30-Sep-2009 has been more subdued, up just 5.2% over-all. The positive effect of Air Asia, particularly at KLIA, is clear. While traffic at KLIA's main terminal building (MTB), home of Malaysian Airlines and other international airlines, is down 9.3% for the year (1.2 million passengers less than 2008), traffic at the LCCT is up a remarkable 29.2%, an extra 2.1 million passengers. International traffic at the LCCT makes up the majority of this growth, surging 48.6%, to 5.3 million passengers.

Kula Lumpur International Airport (KLIA) passenger traffic, nine months ended 30-Sep-09

Source: Centre for Asia Pacific Aviation & MHAB

LCC passengers do not appear to be spending less either. Non-aeronautical revenue per passenger movement was up 7.8% for the first nine months, although much of the increase was also attributed to increased rental of available commercial spaces. Aeronautical revenue has also stayed positive, up 10% per passenger. The result in an overall 7.8% increase in income per passenger movement, to MYR32.95

MAHB Airports segment financial performance:

MYR'000	9m 2009	9m 2008	Y-o-Y
Revenue	1,212,416	1,069,515	13.4%
Aeronautical	564,857	488,322	15.7%
Non-Aeronautical	592,434	522,264	13.4%
Operating costs	-796,135	-686,374	16.0%
EBITDA	416,281	383,141	8.7%
Total income per passenger (MYR)	32.95	30.6	7.8%
Aero- revenue per passenger (MYR)	15.4	14.0	10.0%
Non-Aero revenue per passenger (MYR)	16.1	14.9	7.8%
Total operating cost per passenger (MYR)	21.6	19.6	10.3%

Source: Centre for Asia Pacific Aviation & MAHB

The improved revenue has not translated into improved operating results, as costs have climbed at MAHB's airports by 16% in the first nine months of the year. While staff costs as a % of operating costs are down by two percentage points, total costs per passenger movement increased 14.6%. Profit before tax dropped by 1.5% compared to the corresponding period last year. Margins are still healthy, at 27%, but down on previous years.

EBITDA margin and PBT margin: 2007 to 9m 2009

Outlook:

MAHB Group expects continued positive airport operations and has also taken moves to grow its non-aeronautical revenue. The recent financial restructuring of MAHB is expected to further strengthen performance, and MAHB is optimistic that remaining 26% of the targeted EBITDA will be achieved in the next quarter, bring full-year EBITDA to MYR613 million.