The airline’s transformation is in line with the government’s strategy to position Thailand as a regional center for tourism.
Mixed results amid recovery
THAI has reported a complex financial position for the first half of 2024, reflecting the airline’s continued recovery from the pandemic.
Revenue rose 14% year-on-year to 89.9 billion baht (excluding one-off items), driven by increased passenger numbers. However, costs also rose 27.3% to 72.9 billion baht, mainly due to inflationary pressures and the restructuring of the airline’s operations.
As a result, operating profit before financial expenses and exceptional items fell 21.3% to 17 billion baht. Financial expenses calculated under TFRS 9 amounted to 9.4 billion baht, while exceptional items, mainly foreign exchange losses and asset impairments, amounted to 4.8 billion baht. This resulted in a net profit of 2.7 billion baht, a sharp decline from 14.8 billion baht in the same period last year.
Despite the lower net profit, earnings before interest, tax, depreciation and amortisation after aircraft lease payments reached 18.4 billion baht, exceeding the target, demonstrating the company’s fundamental strength, although the full impact of foreign exchange losses weighed on the bottom line.
Passenger numbers rose by 11.8 percent to 7.68 million. The average aircraft utilization increased to 13 hours per day. However, the utilization rate fell from 81.4 percent to 78.1 percent.
The airline’s financial situation remains difficult. Total assets increased by 31.5 billion baht to 270.5 billion baht, but liabilities increased by 28.8 billion baht to 310.9 billion baht. As a result, equity deteriorated by 2.7 billion baht to minus 40.4 billion baht.
Cash reserves improved, rising 14.6 billion baht to 81.7 billion baht. The airline also made progress in debt repayment, paying 4.6 billion baht of its 13 billion baht debt target for the year.
The results highlight the challenges facing THAI, but also demonstrate the airline’s resilience and progress in its recovery.
Further growth plan
Following the recent completion of a restructuring and acquisition of A320 aircraft from THAI Smile Airways, the airline’s fleet efficiency and competitiveness have improved, significantly increased operational performance and enhanced its ability to optimise route and network planning to meet THAI’s customer demand, Piyasvasti said.
To increase revenue, the airline has changed its marketing strategy and is now focusing on improving its flight routes, he said.
“Instead of focusing on the direct market, we will focus on network destinations. Instead of flying from London to Bangkok, the network destinations would fly from London to Bangkok and then to Hanoi, with appropriate business class accommodation,” he explained.
The move will make Thailand a true regional aviation hub while strengthening both domestic and ASEAN routes, he said.
Meanwhile, THAI plans to open a new route to Brussels, with two newly leased aircraft expected to arrive in the fourth quarter. This will enable the company to increase the frequency of its flights to highly attractive regions such as Europe, North Asia and South Asia, especially India.
As of June 30, THAI and its subsidiaries operated 77 active aircraft with total cash flow of 80 billion baht.
