KUALA LUMPUR (May 18): Capital A Bhd (KL:CAPITALA) posted a net profit of RM22.45 million for its first quarter ended March 31, 2026 (1QFY2026), marking its sixth consecutive quarter in the black.

While the latest quarterly net profit is down 96.7% from the RM689.57 million it reported in the previous corresponding quarter — the 1QFY2025 results had still included full operational contributions from the airline assets before they were carved out — the group's restructured continuing operations staged a clear turnaround.

Its latest net profit, derived from continuing operations that exclude the aviation business sold to AirAsia X Bhd (KL:AAX), reverses a net loss of RM190.43 million recorded by these same segments a year ago.

These continuing operations — which now comprise logistics, engineering, digital and other businesses — recorded a revenue of RM766.59 million for 1QFY2026, up 84.93% from RM414.5 million a year earlier, its bourse filing showed on Monday (May 18).

Its logistics arm, under Teleport, delivered its highest-ever first-quarter revenue of RM308.7 million, up 19.6% year-on-year from RM258.2 million, supported by growth in e-commerce cargo volumes and parcel deliveries. That, coupled with reduced finance costs, lifted Teleport's net operating profit to RM3.1 million in 1QFY2026 from RM417,000.

Its engineering business, Asia Digital Engineering (ADE), saw revenue rise 7.3% to RM222.2 million from RM207 million, driven by expansion in line maintenance operations and a growing third-party airline client base. ADE's net operating profit rose 15.5% to RM18.03 million from RM15.61 million.

AirAsia Move, the group’s online travel platform, recorded a 5.6% revenue drop to RM120.04 million from RM127.21 million, dragging net operating profit down 10.6% to RM9.99 million from RM11.17 million.

The board did not propose any dividend for the quarter under review.

The group's earnings before interest, tax, depreciation and amortisation (Ebitda) from continuing operations came in at RM99.11 million for 1QFY2026, versus a loss of RM138.41 million in 1QFY2025.

However, profit before tax from continuing operations dropped 56.8% to RM26.4 million from RM61 million, no thanks to a RM2 million foreign exchange loss — as opposed to a foreign exchange gain of RM21 million previously — and a cessation of RM15 million interest income from the group's discontinued operations following a debt settlement on the completion of the aviation business disposal. 

Capital A said its latest quarterly performance was largely in line with internal targets, noting that a significant portion of the group’s revenue and profitability is typically weighted towards the second half of the year. It also said it experienced minimal impact from the Middle East conflict.

Nevertheless, it has implemented protective stop-gap measures, including increasing fares, meal prices, and introducing a fuel surcharge — to safeguard its commission collection and meal supply.

Looking ahead, Capital A noted that the upcoming second quarter is traditionally a quiet period for the group, coinciding with the lowest travel season. But it anticipates a strong ramp-up in the subsequent quarter, with performance anticipated to peak in the fourth quarter.

"This growth will be supported by the e-commerce peak boosting the logistics business (Teleport) and heightened travel demand driving performance for AirAsia MOVE, Santan, and AirAsia Next.

"Furthermore, efforts to secure more third-party businesses are expected to materialise later this year, notably with Santan launching its 'Grab & Go' business and AirAsia Next’s diversification into non-airline based licensing income, which is expected to provide significant uplift later in the year," it said.

Meanwhile, it is awaiting Bursa Malaysia’s formal approval to uplift its Practice Note 17 (PN17) status, after completing its regularisation plan in January.

Capital A's share price fell one sen or 2.38% to close at 41 sen on Monday, giving the group a market capitalisation of RM1.83 billion.