Malaysia Airlines said today it has returned to the black with a full year net profit after five straight years of losses.

The national carrier posted a net profit of RM339.10 million for the year to March, with sales rising to RM8.67 billion from RM8.38 billion the year before.

However the company warned it is not out of the woods yet because the Severe Acute Respiratory Syndrome (Sars) outbreak and the Iraq war had hit its revenue in the new financial year.

It attributed the turnaround to lower financial costs and gains from the sale of aircraft following large-scale restructuring after the government renationalised it in 2001.

Financial costs slid to RM148.21 million from RM414.87 million the year before, while gains from the sale of aircraft amounted to RM128.12 million from RM21.04 million, it said.

It also logged gains of RM229.50 million from its recent corporate revamp.

Impact of Sars severe

The airline said the overall load factor for passengers was 69.4 percent and cargo 68 percent, bringing the total overall load factor to 68.9 percent, up from 66.7 percent in 2002.

However it said its performance has been hit by the Iraq war and the Sars epidemic, with passenger traffic falling 15 percent and total capacity cut by 10 percent in April and May.

"The impact of Sars o­n the traffic performance of Malaysia Airlines has been quite severe," the carrier said.

"The combined effect of reduction in passenger load and capacity cutback has caused considerable strain o­n the airline in the first two months of the new financial year." - AFP