Three years after facing bankruptcy, Malaysia Airlines is enjoying record-breaking profits, saying that it achieved an MYR852.7 million (US$260.7 million) net income in 2007, reversed from a MYR133.7 million loss in 2006 and the best result in the company's 60-year history.

MD and CEO Idris Jala said MAS surpassed its original 2007 target by 184%. It forecast a MYR700 million profit last month. It cited strong demand, "sustained yield improvements" and operational improvements valued at MYR2.6 billion for the achievement.

"However, we have just arrived at base camp," Jala warned. "From turnaround, we now move to transformation. We must secure our future success in view of the overcapacity and liberalization which will impact all the airlines' profits and margins." He said MAS will move forward with a "radical restructuring" of its procurement, distribution and e-ticketing operations in an effort to generate an additional MYR1 billion in savings this year.

Air Transport World's 2008 Phoenix Award winner enjoyed a 12.4% increase in full-year operating revenue to MYR14.69 billion against a 5.2% rise in costs to MYR14.41 billion. Operating result swung to an MYR875.2 million profit from a MYR201.7 million loss in 2006. It said load factor lifted to 71.5% and yield climbed 12% to MYR0.27.

Fourth-quarter net profit of MYR242.3 million was just under double the MYR122 million reported in the final three months of 2006. Operating profit jumped 75.5% to MYR260.8 million.

"We have come a long way from our MYR1.3 billion losses and near bankruptcy in 2005," Jala said. "We also have money in the bank, a healthy cash position of MYR5.3 billion which we will use to grow Malaysia Airlines." He said that "barring exceptional circumstances," MAS should achieve its "stretch" target of MYR1 billion in profit this year and be in position to "double or even triple" that figure by 2012.