MAS Performance Under Idris `a GLC Success Story’

KUALA LUMPUR: Early this month, the boss of Malaysian Airline System Bhd (MAS), Idris Jala, decided to serenade some senior editors during dinner.

He felt compelled to do so after Lat, the cartoonist, drew him playing guitar, a skill much publicised by the media after he was named as the one to lead the troubled national carrier.

Apart from the singing, what really caught the attention was how relaxed he was. Fast-forward three weeks later and the reason is clear.

Under Idris, MAS has managed to slash losses from RM1.3 billion in 2005 to RM136 million in 2006. It made money from operations in the second half of last year.

It now promises to deliver a record net profit this year.

Analysts think that MAS can do it.

TA Securities senior analyst Rosnani Rasul said the estimated figure is not far from her own of RM572 million. Most analysts expect between RM452 million and RM572 million in net profit.

Based on its 2006 results, she said it was clear the airline has indeed shown tremendous improvement in its operations.

OSK Research manager Chris Eng said the performance should be seen as a “GLC success story”.

Based on his RM461 million net profit forecast for this year, he is positive the airline would not have a problem achieving its profit target.

“The target is achievable. Despite the favourable projection, the airline must also take into account several high `other costs’, especially in its domestic operations, that could affect its yield.”

The results shown by Idris and his team underline one important fact. Government-owned companies can thrive if their parent decides not to interfere in their affairs.

Their bosses must also be empowered to make the right decisions, however tough these may be.

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