Kuala Lumpur, Malaysia - As scores of small-time investors gathered in the utilitarian surrounds of Malaysia Airlines training centre on June 25 for the company’s annual shareholders meeting, the mood in the room was one of anger and frustration.
Investor after investor questioned the directors on why, after so many years of restructuring, the airline still could not create a sustained profit.
"I listen patiently year after year and the same things are said," said retired researcher Rahim Bidin to enthusiastic applause. "And every year nothing happens. I'm very disappointed with the performance. If you cannot solve the problems then let someone else (try)."
The three-hour meeting, which started with a minute's silence for the passengers and crew of the still-missing flight MH370, ended with a close vote on the re-appointment of Chief Executive Ahmad Jauhari Yahya to the board and a secret poll on whether to grant the board their directors' fees of $123,000.
In between, the mostly elderly Malaysians chastised the board and the company's largest shareholder - sovereign fund Khazanah Nasional - for their incompetence, with one comparing the company to a "sunken ship" and another a patient in intensive care.
Through it all, the board sat largely impassively. Chairman Md Nor Yusof handled most of the questions, insisting management recognised the gravity of the situation and would implement "radical change".
The minority shareholders' meeting was the first since MH370 disappeared in March with 239 passengers and crew on board. Despite a multinational search effort focused on the southern Indian Ocean, the plane has yet to be found. But even before the flight disappeared from radar screens, Malaysia Airlines faced severe financial difficulties.
The airline's loss in 2013 reached $374m - despite a much-trumpeted plan to return it to profit - and the loss for the first three months of this year was the worst in 10 quarters. The disappearance of MH370 made an already difficult situation worse.
"Certainly, we are not satisfied with our performance in the financial year 2013," Jauhari admitted.
"The business reset embarked upon in 2012 was not comprehensive or deep enough to deliver the desired results on yields, cost efficiency or productivity. Radical change was on our agenda even before the tragic events of March 8. These events have now added an entirely unexpected dimension, damaging our brand and our business reputation and accelerating the urgency for radical change."
The board had little information to offer on what the latest plan might entail.
Layoffs and more
Local media have suggested a reduction in the airline's 20,000 strong workforce, the sale of subsidiary units, such as engineering and cargo operations and even privatisation. Some have raised the issue of bankruptcy although Malaysia's laws do not give the kind of protection provided by Chapter 11 in the United States, which has given some North American carriers the space to overhaul struggling businesses.
Everybody knows that Malaysia Airlines is walking the final few months of its existence if nothing is drastically reformed.
Mohshin Aziz, an equity markets analyst who covers the airline for Maybank Kim Eng Securities in Kuala Lumpur, said whatever the management plans to do they need to do it quickly.
"Everybody knows that Malaysia Airlines is walking the final few months of its existence if nothing is drastically reformed. There has to be a new way of doing things as soon as possible," he told Al Jazeera.
Chief Executive Jauhari told the meeting that bookings from China had dropped 60 percent as a result of the plane's disappearance and the move to withdraw advertising for two months as a mark of respect for those on board, had a negative impact on sales. The event also, he said, hurt the airline's brand and reputation.
"Because of the MH370 incident, there's less opportunity to generate revenue," noted RHB Research's Jerry Lee. "It's created an urgency for them to look into the costs they can control."
Both analysts agree a 2,000 to 4,000 employee reduction, as well as dropping unprofitable routes is necessary. They also say Malaysia Airlines needs to stop competing on price with budget carriers such as AirAsia whose costs are lower in the first place, and try to emulate Singapore Airlines' level of productivity.
Mohshin says privatisation would make the process of turning around the company happen more quickly because the airline, which is owned mostly by Malaysia's sovereign wealth fund, wouldn't need to seek shareholder approval for every proposal.
"It needs someone who's motivated by profit and not worried about losing stature or historical glamour," he said. "You need someone who's really ruthless."
The government's role
The government has asked that due diligence be carried out soon to identify the reasons behind the losses and the best options to solve them
The airline's current chairman is a former banker and led Malaysia Airlines through a previous restructuring more than a decade ago, when it was also on the point of collapse. Although the airline returned to profitability under his leadership, the performance could not be sustained. It's swung between modest profits and troubling losses ever since.
The government, which retains a "golden share" - including veto rights - in the carrier, remains tight-lipped over the airline's future. Malaysian Prime Minister and Finance Minister Najib Razak told parliament in a written reply last week that officials were looking into the reasons for the airline's problems.
"The government has discussed MAS [Malaysia Airlines Systems] dismal financial performance and asked that due diligence be carried out soon to identify the reasons behind the losses and the best options to solve them," Najib told the lower house in response to a question from opposition member Lim Guan Eng.
The minority interest investors at the June 25 meeting - many of them former pilots and cabin crew - had no shortage of suggestions. As well as questioning whether the board and management should retain their positions, they criticised previous revamps as drawn up by "power point experts with tremendous presentation skills and no experience". They urged the board to emulate the business practises of other, successful, full-service carriers like Cathay Pacific and Singapore Airlines and enlist the help of MAS' former top executives including managing director Abdul Aziz who retired in 1991 after 20 years with the carrier.
Rahim, sitting with his wife and daughter who also own shares, noted how US businessman Lee Iacocca had accepted a salary of just $1 to manage Chrysler when the car maker was on the verge of collapse in 1979.
"Malaysia Airlines management needs to show that kind of commitment," he said. All three rejected the board's request for fees. "They'll still get the money because Khazanah's the biggest shareholder, but we want to send a message."