KUALA LUMPUR (Nov 28): The weaker US dollar was a tailwind to Capital A Bhd (KL:CAPITALA) in the third quarter ended Sept 30, 2024 (3QFY2024).

After four consecutive quarters of losses, Capital A posted a record-high net profit of RM1.64 billion for 3QFY2024, as opposed to a net loss of RM102.75 million a year ago, as the group recognises RM2.27 billion in foreign exchange (forex) gains compared with a forex loss of RM93.92 million in the corresponding quarter.

Capital A, which is in the midst of selling its low-cost airline business to AirAsia X Bhd (KL:AAX), said in the filing to Bursa Malaysia that the hefty forex gains were due to the weakening of the US dollar against the local currencies of the markets where the group operates during the quarter.

The group’s quarterly revenue grew by 16.6% year-on-year (y-o-y) to RM4.93 billion, boosted by its airline business which saw a 15% y-o-y increase in revenue to RM4.5 billion.

Capital A posted a net operating income of RM9.85 million in 3QFY2024 compared with an operating loss of RM181.59 million previously. Its Ebitda increased by 43% to RM639.5 million against RM447.98 million a year ago. 

“This positive performance was driven by strong travel demand, favourable fuel prices and [the] strengthening of the Malaysian ringgit against the US dollar. This was achieved despite still having non-active aircraft.

“Including these non-active aircraft, the aviation group would record an additional Ebitda of RM195 million,” said Capital A in a statement.

No dividend was declared for the quarter.

For the first nine months of FY2024, Capital A’s net profit jumped 82.3% to RM1.09 billion from RM600.63 million in the same period last year, while revenue expanded by 51.7% to RM15.04 billion, from RM9.91 billion.

Capital A chief executive officer Tan Sri Tony Fernandes noted in the statement that the group is on track to complete the disposal of its aviation business to AAX by January 2025. 

“Concurrently, we are actively working on submitting and securing approval for our regularisation plan, which is now simplified,” he added.

“Looking ahead, we anticipate a strong fourth quarter. Our aviation business will be driven by peak travel season and increased capacity,” Fernandes said.

For its Asia Digital Engineering (ADE), the group’s maintenance, repair, and overhaul (MRO) arm, is expected to capture growing MRO demand through the expanded hangar capacity.

Meanwhile, the group is also optimistic about its in-flight caterer, Santan, following its entry into the third-party airline catering market, which will further boost its revenue. 

"Teleport's robust performance, driven by increased volume and operational efficiencies is expected to continue. The successful resolution of freighter capacity issues and the expansion of our network will further strengthen our position in the logistics market," Fernandes said.

Shares of Capital A gained two sen to RM1.09 on Thursday, giving the group a market capitalisation of RM4.67 billion. The counter has risen nearly 33% year-to-date.