News
THAI and Nok Air still unprofitable in Q3
November 18th 2016
Thai Airways International (THAI) is likely to miss its savings target this year, despite significant year-on-year improvements. Read More »
In the third quarter ended September 30, THAI recorded a net loss of 1.6 billion baht ($45 million), far better than the 9.9 billion baht deficit posted a year earlier, but still short of its targets.
The flag carrier posted an operating loss of 836 million baht during the period, improved from a loss of 3.4 billion baht a year earlier, as fuel expenses dropped 33.6% and passenger numbers rose 7.6% to 5.5 million.
The Star Alliance member said it booked impairment losses on assets and aircraft of 624 million baht for the quarter, but recorded 120 million baht in foreign exchange gains.
THAI CEO, Charamporn Jotikasthira, said THAI’s full-year revenue target of 180 billion baht is likely unachievable, but he did not rule out a full-year net profit despite several recent setbacks, including a Thai government clampdown on Mainland ‘zero dollar junkets’ and the passing of Thailand’s much revered king, the late Bhumibol Adulyadej.
"We've got the impact. Lots of cancellation and postponements, as people are not in the mood and we understand and respect that," said Narongchai Wongthanavimok, THAI’s executive vice-president of finance and accounting.
THAI has made some network adjustments through to March 25, including previously-reported new thrice-weekly Bangkok-Frankfurt-Phuket B777-300ER service and a four-weekly Bangkok-Moscow Domodedowo B777-200ER route starting December 15 (delayed from November).
During the winter, the carrier will increase frequency to Oslo from five-weekly to daily, to Brussels from thrice- to four-weekly and to Heathrow from 12-weekly to double daily.
Meanwhile, THAI has begun operating its two A350s four times a week to Rome, thrice a week to Milan, as well as on select services to Singapore.
In other Thai updates, low-cost carrier (LCC) Nok Air, in which THAI holds a 39% stake, also had a bad third quarter.
The budget carrier’s third quarter net loss deepened from 653 million baht last year to 1.1 billion baht this year on 4.3% improved passenger revenues. Nok said its international routes fared well but its domestic operations, its bread and butter, suffered a 7% year-on-year revenue decline amid its highly-publicized pilot shortage as well as intense competition.
Nok Air’s yield dropped 4.5% through to September 30, its costs rose 19%.
Nok’s long-haul budget joint-venture, NokScoot, trimmed its net loss from 298 million baht to 147 million baht during the third quarter.
Not every airline in Thailand is haemorrhaging. Bangkok Airways once again stands out as the kingdom’s top performer. The full-service carrier posted a 14% third quarter net profit increase on the back of rising passenger numbers and revenues after opening new routes and adding flight frequencies.
