Flag carrier Malaysia Airlines today said it is upbeat about the coming year and expects to remain profitable despite a setback from the recent Sars crisis.

The airline returned to the black with a net profit of RM339.1 million in the year to March, after a five-year run of losses.

But Severe Acute Respiratory Syndrome dealt a heavy blow to revenue in the June quarter as it was forced to ground eight aircraft and cut more than 700 flights to Sars-affected areas.

Last month, it forecast revenue growth for the year to March 2004 to remain flat after losses doubled in the June quarter to RM164.51 million.

Recovering passenger load

Paul Mooney, senior general manager for network revenues, said the airline suffered an average 20 percent drop in bookings in all sectors at the height of the Sars epidemic.

But air travel has rebounded with passenger load recovering to 74 percent and the carrier aims to reinstate by October 90 percent of flights which had been scrapped, he said.

"Our seat factors have recovered. We are now on par with last year. The recovery after Sars has come back quicker than what we expected," he told reporters.

Chairman Azizan Zainul Abidin expressed confidence the airline would stay profitable as the large-scale restructuring after the government renationalised it in 2001 had placed it on a strong footing.

"We're optimistic for the future. Barring any untoward incident like the Sars epidemic, we should be able to continue making profit," he said.

"The problems we have faced in the past three years have prompted Malaysia Airlines to be more flexible, resilient. Our resilience was seen when we faced the Sars problem. We were able to adjust our operations to minimise the Sars impact."

Expansion program

The airline has announced plans to boost Asian routes, recruit some 800 staff and take on larger aircraft as it resumed its expansion program after a pause during the tourism industry's Sars-induced slump.

China is a key growth point, and sales and marketing senior general manager Ahmad Fuaad Dahalan said flights to Shanghai would be gradually increased to 14 times a week by April, from seven flights now.

"We are back on track and we are looking at more opportunities because we find the present situation requires us to expedite or fast-track many of our frequency to Asia, Australia and the rest of the world," he said.

The carrier is also looking at more flights to South Africa following a request from President Thabo Mbeki during his visit here last week, Mooney added. - AFP