However, the company is preparing for a possibility of further weakening of the Malaysian currency by hedging its fuel requirements.
This was revealed as the national carrier announced its results for the quarter ended in September, Nikkei Asian Review reported today.
MAB reported that for the first half of next year, it had “hedged significant fuel requirements” to overcome the expected volatility in the dollar.
“MAB also believes the price of fuel will drop in 2017, and this will lead to significant savings for the company, which it will pass on to customers,” the MAB financial report said, adding that the uncertainty over the UK’s exit from the European Union might have an impact on next year’s performance.
The airline said it was also preparing for some intense competition from other Malaysian carriers, but is concerned that this will lead to over-capacity in the domestic market.
However, MAB sees the competition contributing to air fares trending “significantly downward in 2017”, according to Nikkei.
Meanwhile, on the third quarter report, MAB called it “an encouraging performance”.
This was because the company had managed to reduce its operating loss level by 7% when compared with the loss incurred in the previous quarter.
“This is a positive indication that the turnaround efforts are on the right track.
“The focus in the first half of the year was on reducing costs and improving the customer experience. From July 2016, we began to push hard on revenue generation with more aggressive sales and marketing initiatives,” MAB chief executive officer Peter Bellew said in the statement released on Wednesday.
“The group expects to record a loss for the year 2016, but significantly smaller than initially budgeted.”
Meanwhile, the airline also reported a year-on-year improvement in passenger numbers, saying it carried 3.6 million passengers between July and September this year. This passenger load level was 79.3%, which is a 5.3% increase on the same period last year.
However, Nikkei reported that the airline’s on-time performance dipped to 68%.
The overall outlook for next year, according to MAB, is positive with the airlne expecting to carry more than 15 million passengers, despite being in a “tough operating environment”.
Bellew was reported recently as saying that the airline will make a profit in two years.