Cargo freighter operator MJets Air Sdn Bhd (MJets), a 99%-owned subsidiary of MMAG Holdings Bhd, is scaling down its operations by 45% starting this month as part of cost containment efforts amid mounting financial pressure.
In an internal memo, MJets described the move as a “prudent step to preserve resources and maintain operational stability”, citing rising fuel costs, geopolitical uncertainties and weaker charter demand as key challenges affecting the aviation sector.
Effective April 6, the company has implemented salary adjustments and introduced voluntary leave-without-pay schemes as part of its restructuring measures.
MJets plays a key role in MMAG’s aviation segment, although the group has recently come under scrutiny following reports that its bank accounts had been frozen since late last year. NexG Holdings Bhd is also a shareholder in MMAG, holding a 9.48% stake.
Financially, MJets has been under strain. For the financial year ended Sept 30, 2024, the company recorded a net loss of RM67.62 million on revenue of RM370.78 million. It has only reported a single profitable year over the past five years. As at end-September 2024, MJets had total liabilities of RM479.62 million, exceeding its total assets of RM413.78 million, with accumulated losses amounting to RM151.84 million.
Despite the challenges, MMAG had continued to invest in the aviation unit. Less than six months ago, shareholders approved the acquisition of a Boeing 737-800 converted freighter for US$25.9 million (RM109.85 million), which is to be leased to MJets under an intra-group arrangement.
MMAG first acquired an 80% stake in MJets in November 2020 for RM21.36 million, aiming to capitalise on surging e-commerce demand during the pandemic. The stake was later increased to approximately 98.57% through a capitalisation exercise.
While MJets had secured an Air Operator’s Certificate from the Civil Aviation Authority of Malaysia in 2021, enabling it to operate cargo and charter services across Malaysia and Southeast Asia, the business has yet to deliver consistent profitability.
The company has also faced operational and legal challenges, including past investigations and a countersuit filed by former stakeholders related to the acquisition and restructuring of the business.
At the group level, MMAG reported a net profit of RM32.18 million for the 15-month period ended Dec 31, 2025, on revenue of RM1.15 billion, although its longer-term track record remains impacted by years of losses.
The latest cost-cutting measures at MJets highlight ongoing efforts by MMAG to stabilise its aviation operations amid a challenging industry environment.
