Malaysia Rail Company to Make its First Profit this Year

Malaysia, rail services

Keretapi Tanah Melayu Bhd (KTMB), Malaysia largest rail service, will finally turn in its first profit after almost two decades of losses, said its new chief executive officer (CEO) Mohd Rani Hisham Samsudin.

KTMB, which has lost almost RM3 billion since it was corporatised in 1992, is expected to declare a net profit for fiscal year 2017, declared recently its CEO, Mohd Rani Hisham Samsudin to the newspaper NST. Malaysia national rail company has only be profitable from 1993 to 1995. Low fare structure has been seen as the main responsible for the bad financial results of the company. 

Mohd Rani Samsudin said the major contributor to the profit is passenger ticket sales. Profits is now driven by the  successful ETS (electric train service) zhich links Kuala Lumpur to Penang and the Thai border as well as shuttle services between Johor Baru and Woodlands in Singapore. Both operations should ensure that KTMB remains profitable year-on-year. New services such as business class coaches in the ETS will also help generating more revenues.

“When I came in to KTMB, I realised what we need to do first is not transformation of the business. It is about the transformation of working culture and attitude.”

“KTMB has about 5,700 employees. The first thing we did was to address the union on what they want to do and what we should do. That way, we all understand the health situation of the company and work towards that direction, the division of roles and functions and at the same time having common agenda to develop and grow the company. We have to run KTMB as a business entity,” explained KTMB CEO.

Mohd Rani said his first key task when he joined KTMB was to stop the continuous losses in the company.

“It is a challenge to turn around KTMB but I took on the responsible as I believe it can be profitable. Besides engaging with the staff, we have been reviewing all contracts that were outsourced, and looking at the unprofitable routes.

“Either we cut them off our service, or look at other methods to improve passenger volume. This is despite the constraint from the current track rehabilitation under KVDT1 project that limits the frequency of the train and the number of cargo wagons in one rake,” Mohd Rani said to the New Strait Times.

The other main contributing factor was KTMB’s high operational cost in maintaining its rail coaches and infrastructure, plus high electricity and diesel consumption, and manpower costs.