Malaysia Airports Holdings Berhad (MAHB)

2019

Industry Champions of the Year

Malaysia Airports Holdings Berhad (MAHB)

Industry Champions of the Year

2019

WORDS FROM THE JURY PANEL

MAHB was named Industry Champion for its proven track record of business sustainability and solid financial returns to its shareholders. Strong corporate governance and responsible corporate citizenship, along with its significant contribution to the industry and the country in which it operates, are all hallmarks of an organization with both business acumen as well as soul.

Malaysia Airports Holdings Berhad (MAHB)

The Sky’s The Limit

Airport operator creates joyful experiences by connecting people and businesses.

Malaysia Airports Holdings Berhad (MAHB) is one of the largest airport operator groups in the world in terms of number of passengers handled. The corporation manages 39 airports across Malaysia, with five international airports, 16 domestic and 18 STOLports, as well as an international airport in Turkey.

A Malaysian-registered company incorporated in 1991, MAHB manages, operates, maintains and develops airports. Aeronautical revenue come from aeronautical operations, passenger service charges and other airline charges, while non-aeronautical revenue is derived from airport-related commercial activities such as duty-free operations, rental and revenue sharing from airport retail outlets. MAHB also derives a significant amount of non-airport related revenue from its hotels and oil palm plantation. The company also owns land in Sepang, Malaysia for future airport development and expansion. No surprise, therefore, that it became the first airport operator in Asia to list at RM13.9 billion.
As industry leaders in Malaysia, who have been in the business for 28 years, MAHB have kept itself competitive by optimizing passenger service charges, passenger security service charges and landing charges. LeighFisher’s 2017 report noted that aero revenue per passenger as well as per aircraft movement at Malaysian airports is only around one-third of the benchmarked average.
oresight and business acumen have also contributed to MAHB’s success, with the building of the Low-Cost Carrier Terminal (LCCT) specifically designed, and built to accommodate the high growth of passenger movements for budget air travel. klia2 was also built in response to accommodate higher passenger growth. On 9 May 2014, the LCCT was officially closed and replaced by the Kuala Lumpur International Airport 2 (klia2) which opened on 2 May 2014. klia2 is billed as Malaysia’s Next Generation International Airport Hub, allowing seamless connectivity for both local and international low-cost and full-service carriers. klia2 is designed to cater for the explosive growth in the low-cost travel industry, and is scaled to accommodate 45 million passengers a year. klia2 is one of the few airports in the world with its own mall, Gateway@klia2.
In recent years MAHB has intensified efforts to enhance network connectivity especially at its secondary international airports. Doing so meant being offering attractive incentives to entice new airlines, and collaborating with tourism agencies in destination marketing efforts. MAHB’s Airline Incentive Program offers new airlines a waiver on landing charges, and support in defraying their operational cost during their first year of operations at MAHB airports.
In 2018, the company initiated a commercial reset strategy with the objective of raising the retail profile at its international and domestic airports. Malaysia Airports is embracing the opportunity to reformat the retail mix by aligning product categories with consumer preferences. This concept goes beyond traditional passive retail formats and encourages brands to inject experiential marketing experiences to induce impulse purchases. In January 2019, MAHB signed a Joint International Tourism Development Program MOU with Tourism Malaysia that primarily aims to boost tourism from untapped markets into Malaysia. This effort collectively benefits airlines, tour operators, charterers, travel management companies and travel agencies. Sabah and Langkawi are the first Malaysian states to embark on this venture. Seamless travel and memorable experiences are on the top of MAHB’s list of deliverables, and as such, it has recently embarked on Airports 4.0, a digitalization initiative that targets every facet of operations, including both aero and non-aero businesses, in order to provide world-class service and amenities. Where the aero business is concerned, MAHB is looking firstly into implementing Airport Collaborative Decision Making, and secondly, enabling single-travel token in the distant future. For non-aero business, the corporation’s commercial reset strategy assures a one-to-one relationship with target customers, with a consequential fine-tuning of retail offers reflecting customers’ preferences. MAHB has garnered numerous awards and accolades for its business model and practices. On the human resources front, the corporation was named Most Popular Graduate Employer of the Year (Leisure, Travel & Hospitality) at Grad Malaysia Malaysia’s 100 Leading Graduate Employers Awards. It boasts a low turnaround of staff due to the benefits it offers its staff. Inspiring stories of team members beginning from the bottom rung to attain managerial posts are legion in the organization, where staff is treated like family, as opposed to salaried employees.
Some of MAHB’s staff benefits include competitive salaries, unlimited medical benefits which extend to spouses and children, group term life insurance, housing and vehicle loans, and retirement benefits of additional Employee Provident Fund contribution by the employer ranging from three to five per cent of basic salary based on years of service. Learning and development programs abound, and are based on the business direction set for the year. In 2019, the focus is on a ‘Happy Guests, Caring Hosts’ service culture transformation program where associates aim to make guests feel happy and welcomed whenever they travel, by upgrading airport facilities and providing exceptional world class service while aiding in the resolve of issues with minimal setbacks. There is also a strong culture of corporate social responsibility (CSR) within the company, with MAHB investing in CSR practices that are holistic, structured, measurable, and which create sustained value. CSR initiatives for education and youth leadership focuses on elevating academic achievements, and encouraging leadership and character development of students in primary and secondary schools. MAHB assists in elevating community livelihoods, micro industry development, and environmental initiatives as a form of community enrichment. To brand Malaysia, the organization brings the culture of the country to airports it manages, so as to promote local traditional arts and culture to diverse audiences. MAHB has a slew of international awards under its belt, including the Routes Asia 2018 Marketing Awards for outstanding marketing services of new air routes and development of existing services, Best in Customer Experience Engagement at the Social Media Excellence Award, National Energy Awards (NEGTA 2018) for Category I: Energy Efficiency (Large Building) for sustainable practices at Kota Kinabalu International Airport, and was named Best Malaysian Company for Investor Relations at the IR Magazine Awards and Conference South East Asia 2016 held in Bangkok, Thailand. KL International Airport bagged the World’s Best Airport for Immigration Services Award at the 2017 Skytrax World Airports Awards in Amsterdam, Netherlands, and was named Platinum Winner for airports with 25 million passengers per annum and above category at Asia-Pacific Green Airports Recognition 2017 by Airports Council International ACI. Moving forward, MAHB is in the midst of optimization works for all airports under its management, to maximize operational efficiency and improve customers’ experiences by upgrading baggage handling systems and aerotrains. Its digitalization journey will target every facet of operations, with the implementation of the Airport 4.0 initiative, a digital initiative across selected airport networks, aimed at infrastructure enhancement, capacity development and digital innovation. This will include the Internet/Industrial of Things (IIoT) framework, intelligent enterprise, cyber and information security, big data analytics (BDA) and artificial intelligence (AI). A key challenge to digitalization is the trade-off in creating an ecosystem intelligent enough to anticipate customers’ needs, but which will not compromise the security and privacy of customers.

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