SEPANG: As the COVID-19 pandemic left the global aviation industry in dire straits, Malaysia Airports Holdings Bhd (MAHB) has implemented a cost optimisation plan where its capital expenditure (capex) has been reduced to RM320 million from RM1.8 billion set earlier.
Group chief executive officer Datuk Mohd Shukrie Mohd Salleh said the plan will keep the airport operator stable for the next 18 months with a 20 per cent lower operating cost.
He said MAHB is taking steps to reduce operating costs, including revising operating hours and deferring several major infrastructure projects, including the expansion of the Penang International Airport.
“We are of the view that the RM320 million capex is critical for us to still push ahead with several other projects, including replacing our ageing aerotrain and baggage handling system, irrespective of the COVID-19.
“In fact, this is probably the best time for us to replace those assets,“ he told a media briefing after MAHB’s annual general meeting here today.
Meanwhile, Mohd Shukrie said in order to maintain MAHB’s liquidity going forward, it is planning to raise RM1.5 billion through sukuk issuance, in addition to the RM1.7 billion in credit facilities it had obtained from banks.
As at end-March, the airport operator’s cash reserves stood at a healthy RM2.8 billion, he said.
On another note, Mohd Shukrie said the delayed implementation of the regulated asset base (RAB) framework which was originally scheduled to start on Jan 1 this year was a “blessing in disguise” for MAHB.
Under the RAB funding mechanism, the government would provide MAHB with a RM4 billion capex for development and maintenance from 2020 to 2022, and MAHB would need to spend the fund according to the stipulated time frame, failing which it could be penalised.
“Imagine if we had spent a couple of billions, and there is no traffic during this pandemic.
“How are we suppose to get our money back?” he said, adding MAHB and other government agencies are working closely to determine the right time to implement the RAB. -Bernama