Malaysia Airlines says in a quarterly update that it showed “steady progress” in the three months ended 30 September, and is "on target to deliver ahead of budget”.
The airline did not provide any financial figures, but says that cost control continues to be its "central focus".
During the period, aggressive sales campaigns led the airline to a 12% increase in revenue over 2Q 2016. Load factor came in at 79.3%, up from 74% in the previous corresponding quarter.
On its Kuala Lumpur-London route, the carrier saw its market share grow from 45% to 59% over the three months.
Compared to Q2 2016, Malaysia Airlines reduced its net operating loss by 7%, which it describes as “a positive indication" that turnaround efforts are "on the right track”.
"Overall, the airline and the group are expected to record a loss for this fiscal year but management remains confident that both will surpass targets based on traction gained in the turnaround efforts thus far," it adds.
The carrier however remains cautious in its outlook for 2017.
“We have delivered a stronger second half of 2016 but a weak Malaysian Ringgit, Brexit uncertainty and overcapacity in the Malaysian market will be the dominant features of 2017. We have hedged significant fuel requirements but we will continue to be exposed to Dollar volatility in the first half of 2017," it explains.
It also forecasts that unit costs will fall by a further 3% in 2017, and that it will transport over 15 million passengers.
"Despite the tough operating environment Malaysia Airlines believes we can deliver profitable growth in 2018 by controlling costs, competitive airfares, and maximising load factors in a manner that will benefit our customers, our people and our shareholder."