Malaysia Airlines (MAS) said today it had posted a record profit of RM851 million in 2007, ending a series of disastrous losses.

The full-year result is the culmination of a sweeping transformation plan, which saw the airline slash staff and routes and sell non-core assets after suffering losses of RM1.3 billion in the first nine months of 2005.

MAS said the result "marks the national carrier's highest ever in its 60-year history," exceeding the RM461 million recorded in the 2004 financial year.

"This is testament to Malaysia Airlines' life-changing transformation from a close-to-bankrupt airline in 2005 to one that has achieved record profits in 2007," it said in a statement.

"We also have money in the bank, a healthy cash position of RM5.3 billion which we will use to grow MAS," it added, referring to the airline by its acronym.

"We have exceeded all our financial targets and surpassed our 2007 stress target of RM300 million by 184 percent."

MAS posted a net loss of RM135 million in 2006 as the turnaround plan came into force.

It said that in each of the quarters in 2007, both the seat factor and yield rose, and that it reduced its costs by over RM900 million from a year ago.

Best-case senario

The national carrier said last month that it was aiming to post up to RM309 million in profits in 2008, rising to as high as RM927 million by 2012 as its revamps its operations.

Managing director Idris Jala said the targets were a best-case scenario that could be affected by a difficult operating environment, including high oil prices and industry deregulation.

"We believe that if we aim for the best and stretch our limits, we will achieve an annual profit of RM1.5 billion by 2012 even factoring the industry's challenges," he said at the time.

"Should the magnitude of overcapacity and liberalisation be less than what we anticipate, we can achieve between RM2-3 billion per annum."

The airline's target for 2008 was set at RM400 million to RM1 billion.

Under the five-year plan, the airline is focusing on five areas including improving service standards, lowering costs, making fares more competitive, boosting passenger loads and expanding its network.

- AFP