KUALA LUMPUR (Aug 27): Capital A Bhd (KL:CAPITALA) reported its second straight quarterly profit after completing the disposal of its aviation business in January, with growth in its aircraft maintenance business and a turnaround in the logistics segment helping offset softer travel demand.

The group posted a net profit of RM23.87 million for the three months ended June 30, 2026 (2QFY2026) from RM1.45 billion a year earlier. The year-earlier figure was boosted by a RM1.66 billion gain from its now-disposed aviation business, which was classified as discontinued operations. Earnings per share fell to 0.5 sen from 33.5 sen.

On a quarterly basis, net profit rose 6.5% from RM22.45 million.

Looking only at continued operations, which include the logistics, aviation engineering, digital and travel platform segments, the group swung to a profit from a net loss of RM204.22 million.

Revenue for 2QFY2026 surged 91.5% to RM809.36 million from RM422.61 million a year earlier, driven by broad-based growth across its businesses.

Capital A did not declare a dividend for the quarter.

In a bourse filing on Thursday, Capital A said its aircraft maintenance, repair and overhaul arm Asia Digital Engineering Sdn Bhd (ADE) delivered a record quarterly performance, with revenue rising 29% to RM284 million from a year earlier. The increase was driven by higher-value base maintenance checks and stronger workshop orders.

Logistics unit Teleport Everywhere Pte Ltd also returned to profitability, posting a quarterly net profit of RM4.4 million compared with a net loss of RM100,000 in 2QFY2025. Revenue climbed 22% year-on-year to RM311 million as shipment volumes increased.

For the six months ended June 30, 2026 (1HFY2026), net profit fell 97.8% to RM46.32 million from RM2.14 billion a year earlier, reflecting the absence of the large gain from the disposed aviation business. Revenue rose 88.3% to RM1.58 billion from RM837.13 million. Teleport and ADE together generated over 70% of group revenue, partially offset by softness in AirAsia MOVE, AirAsia Next and Santan due to airline capacity moderation.

Excluding discontinued operations, the group swung to a profit in the six months from a net loss of RM395.53 million a year earlier.

Capital A expects operating conditions to remain challenging in 3QFY2026, citing regional capacity cuts and seasonally weaker travel demand. The group nevertheless expects activity to rebound in the fourth quarter.

“We expect operating conditions in 3Q and 4Q to require continued agility as broader global and movement trends evolve. The third quarter of the year is generally a lean travel season; and management are actively prioritising our capital deployment and business plans to reflect that. Overall, while geopolitical issues remain ongoing, we are doing everything possible to keep our full-year performance close to last year's results. Once these global tensions resolve, we expect operations to normalise and we are confident we will deliver the strong growth we typically achieve," Capital A CEO Tan Sri Tony Fernandes said in a separate statement.

Capital A exited financially distressed Practice Note 17 (PN17) status in May, ending more than four years under the classification. Shareholders' equity stood at RM577 million as at end-June, well above the regulatory requirement of RM40 million and 25% of share capital.

"This capital buffer provides total assurance that the group is not at risk of re-entering PN17 status, reinforcing our financial durability and insulating our long-term growth trajectory from external volatility," it said.

Shares of Capital A fell 0.5 sen or 1.49% to close at 33 sen on Thursday, valuing the group at RM1.48 billion. The stock has declined 19.51% so far this year.