Business

Malaysia Airlines shares dip on 2011 loss

Customers at a Malaysia Airlines counter
Image caption The carrier is planning to implement an aggressive sales strategy in a bid to attract more customers

Shares in Malaysia Airlines have dipped after the carrier said it was in a "crisis" as it reported a loss for the last financial year.

Its shares fell as much as 5.6% to 1.350 ringgit on the Bursa Malaysia.

This was afterthe firm reporteda net loss of 2.5bn Malaysian ringgit ($841m; £528m) for the year ending 31 December 2011.

Malaysia's national airline said its profits were dented by a 21% increase in its fuel costs during the year.

"The results make for unpleasant reading. The company is in crisis," said Md Nor Md Yusof, chairman of Malaysia Airlines.

'Stop the bleeding'

Airlines have been facing a tough time thanks to the uncertain global economic environment and volatile fuel prices.

The International Air Transport Association (IATA) has cut its forecast for industry profits to $3.5bn from $4.9bn for 2012.

Even though it has said that airlines in Asia-Pacific will continue to grow, IATA has warned that the pace of growth is likely to slow down.

Malaysia Airlines said that, given the challenging outlook for the current year and its loss in 2011, it is looking to restructure its business in a bid to return to profitability.

"The bottom-line group losses for 2011 underscore the imperative need for Malaysia Airlines to immediately adopt strong measures to stop the bleeding," said Ahmad Jauhari Yahya, Malaysia Airlines group chief executive officer.

"These include staff redeployment, increasing productivity and efficiency, relentless cost control and making further route reviews."