Brahim's to reduce dependency from airline catering

Brahim's Holdings Bhd will reduce its revenue dependency from the airline catering business up to 50 per cent within the next three years from over 90 per cent of the company's topline.

Chairman Datuk Seri Ibrahim Ahmad Badawi said the company is aggressively pursuing non-airline catering business following the conclusion of the new agreement with Malaysia Airlines Bhd (MAS).

"The agreement allows us to pursue non-airline catering business. This was not allowed previously," he told reporters after the company's annual general meeting here today.

Ibrahim said the company recently secured two non-airline catering contracts, namely to provide catering to Emirates lounge at the KL International Airport and Mahsa College campus.

Brahim is also in talks with a few other parties to expand its non-airline catering business, including acquiring a chain restaurant business.

On the airline catering business, Ibrahim said the company had recently started providing daily in-flight halal foods to British Airways on a five-year contract.

He said Brahim's would also provide daily in-flight catering to All Nippon Airways from September on a three-year contract, with an option to extend it for another three years.

With the inclusion of the new contracts, he said the company is currently servicing 37 airlines with Malaysia Airlines being its largest customers.

On the new agreement with MAS, he said the company expects topline contribution from the national carrier to reduce significantly to RM200 million annually from RM260 million per year under the previous agreement due to discounts of up to 25 per cent under the new agreement.

Nevertheless, he is optimistic that the company would return to profitability this year after recording a pre-tax loss of RM39 million last year, for the first time in the company's history.

He said the loss incurred in the previous year is due to a one-time loss following the signing of a settlement agreement with MAS which effectively wiped off RM74 million from its earnings, inclusive of a productivity rebate sum.