Condition 1: The Conditional Waiver is only in respect of unrealised MTM losses for fuel hedging contracts arising from the adoption of FRS 139. If MAS triggers the PN 17 criteria due to reasons other than the above (e.g. realised losses from hedging contracts), the above Conditional Waiver will not apply;

Condition 2: MAS must ensure full compliance with FRS 139 in recognising and measuring all the financial assets, financial liabilities and certain contracts to buy or sell non-financial items as stipulated in FRS 139 in all its financial statements issued in the financial year 2009;

Condition 3: MAS is to take all necessary measures to cease or avoid triggering the PN 17 criteria by 31 December 2009. In the event that the Company triggers or continues to trigger the PN 17 criteria after the expiry of the Conditional Waiver (i.e. 31 December 2009), MAS will be required to fully comply with PN 17 requirements;

Condition 4: MAS must take the following disclosures in its quarterly report(s):

i) a Proforma balance sheet position in its quarterly report (“QR”) ended 31 March 2009, showing shareholders’ equity based on MTM valuation of the fuel hedging contracts as at 29 May 2009 under the FRS 139 reporting principles;
ii) a Proforma balance sheet position without FRS 139 in all its QRs for financial year 2009;
iii) total realised and unrealised losses due to fuel hedging contracts under FRS 139 for financial year to-date in all its QRs for financial year 2009; and
iv) the status of the measures as referred to in Condition 3 above in all its QRs for financial year 2009.

The Conditional Waiver granted by Bursa was after taking into consideration of, amongst others, the following factors:

i) high volatility of the underlying assets (i.e. fuel) hedged by MAS which is subject to MTM valuation giving rise to fluctuations in the Group Equity Holders’ Fund. In this regard, it is noted that the Group Equity Holders’ Fund was negative for the quarter ended 31 March 2009 based on the pricing of fuel price at the material period but positive based on the comparative fuel forward curve as at 29 May 2009; and
ii) the MTM losses of the Group’s fuel hedging contracts are unrealised losses.

Haha...I leave after work and find MAS is nearly kena PN-17 since the company become Net Tangible Liability (NTL). They managed to get a waiver and not put on PN-17 - somehow someone managed to get this waiver.

Actually, lots of airlines hedge against fuel price increase, but I think last year most, if not all, bet the wrong way and recorded losses due to fuel price drop.

The waiver takes into account that the reason it became NTL is due to hedging wrong way, NOT because MAS management failed to properly execute the MAS operations.

In fact, I bought MAS at 2.6 because I have faith that Idris Jala will turnaround the company, and not because it is a GLC. Based on the recovery from 2007, Idris Jala has shown he is capable to turnaround a loss company to profit, taking hard steps where needed. I believe that at the end of 2009, this company will already turn around and later the MTM losses will be history.

Hehe...Just my 2 cents.

if really become pn17?? jia lat la... 

No doubt,MAS will tumble tomorrow,but any big drop(limit down will be ideal) will be an opportunity.

My two sens.

I do not have any privilege information but judging from the wording of the March09 Q announcement and the explaination that follows,it appear to me that MAS is doing hedging of their fuel needs,not trading.But the hedge gone awry due to the fall of crude oil prices in March/april this year.

Just my view,lets have a vitual beer

 

There are 2 MAS topic if I am not wrong???