Prasarana hopeful for a profitable year ahead

The group was on track to achieve profitable year in 2020 before Covid-19 severely disrupted the operator’s services


PRASARANA Malaysia Bhd hopes to record positive earnings in 2021 and beyond as the transport operator’s services were severely disrupted due to the Covid-19-induced Movement Control Order (MCO).

Prasarana president and group CEO Muhammad Nizam Alias (picture; centre) said the group was on track to achieve profitable year in 2020 until the pandemic broke and the group’s ridership took a hit.

“In the 2019 forecast, we expected the group would return to the black in 2021.

“However, with the impact of Covid-19, we cannot be sure, but that won’t stop us from cracking our heads or attempting to mitigate the impact,” he said at the group’s first-half (1H) update in Kuala Lumpur yesterday.

During the 1H20, both Rapid Rail (operator of light rapid transit [LRT], mass rapid transit and monorail services) and Rapid Bus (which operates in the Klang Valley, Penang, Perak and Pahang) suffered reduced ridership.

Rapid Rail’s ridership dropped 43.9% to 63.24 million passengers in 1H20 against 112.73 million in the corresponding period of 2019. The highest drop was recorded in April at 93.7% at the height of the #stayathome order.

The group’s original target was based on the state-owned public transport’s performance last year, as the group managed to reduce its losses to RM249 million, with recorded revenue of RM1.05 billion.

He said instead of focusing on achieving a target, the group would be shifting its focus on earning trust and comfort of passengers.

“If we can push our capacity numbers to pre-Covid-19 levels, then we should be fine.

“But I don’t think we can achieve that by year-end with the kind of economic challenges that we are facing now, so it appears that this year’s performance will be very bad, so our focus is to bring back the confidence and as many passengers as possible into our network,” he said.

He added that with the combined efforts of the public and private sector alongside the government, there should be a noticeable improvement in 2021.

“For the remainder of 2020, we will be focusing on passenger’s welfare, such as ensuring top-notch cleanliness and safety of our assets aligned with the standard operating procedures provided by the government.

“There will also be various promotions for passengers, as we will be rebranding the LRT feeder buses and providing real-time bus information, so passengers can be updated and not feel like they have to waste time waiting,” he said.

Other plans include optimisation of capacity during off-peak hours for the first and last mile service improvements, as well as to implement a new business model for buses while increasing the use of digital technology.

For 1H20, the public transport operator recorded RM277.3 million in revenue, down 42% from RM474.8 million a year ago.

Its recorded revenue is also 43% lower from its original target of RM484.3 million for the period, while its operating costs have also decreased by 8% to RM546.8 million from RM596.5 million, also much lower from its original target of RM710.8 million.

Muhammad Nizam said this was due to public transport not running in full capacity since the MCO implementation.

“We are currently running at 60% and there are still 40% left to go, which we are hoping to boost once Covid-19 clears up or the MCO restrictions are lessened,” he said.

The company’s losses before interest, taxes, depreciation and amortisation stood at RM269.6 million, 122% lower against the formerly recorded figure of RM121.7 million.