Express Rail Link Sdn, which runs trains from Kuala Lumpur to the Malaysian capital's airport, has revived plans for an initial public offering after posting its first full-year profit last year, its executive chairman said.
"It was profitable last year and we hope it can be profitable this year," Mohammed Nadzmi Mohammed Salleh said in an interview in Kuala Lumpur, declining to provide earnings figures. "Flotation is of course in our mind. That's how we want to bring this company forward."
Express Rail in April scrapped plans for an IPO last year as the outbreak of SARS and the US-led war against Iraq led tourists and businesspeople to avoid the region.
Travel has since rebounded, with Malaysia predicting a record number of tourists will visit the country this year.
That should lift passenger revenue at Express Rail, which is 40 percent owned by Malaysia's Muslim pilgrim fund, and half-owned by YTL Corp, the country's biggest builder. The company plans to sell shares to help pay loans used for the construction of the 2.4 billion ringgit (US$632 million) line, which started operating in June 2002.
"With the decline of the ringgit I expect an influx of tourists to enjoy one of the more value-for-money destinations in the region," said Azrul Azwar, an economist with MIDF Sisma in Kuala Lumpur.
Express Rail spent last year reducing costs after the outbreak of SARS cut Express Rail's daily passenger numbers by about a fifth to 4,000. The company renegotiated contracts on maintenance, the provision of spare parts and insurance, helping reduce costs by about 5 percent, Nadzmi said.
The company also cut the size of its workforce by 15 percent to 110 people.
It now wants to increase the number of people using the service between Kuala Lumpur and the airport to a daily average of about 6,000. Currently, about 5,000 people make the 56km journey every day.
Express Rail this week signed an agreement with Malaysian Airline System Bhd for the national carrier to sell tickets to international visitors and increase the number of people using the train to get from the airport to Kuala Lumpur.
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