Thai Airways Report Reduced Profits, But End of Financial Restructuring in Sight

[Georgealbert]

 

Picture Thai Airways

 

Thai Airways has announced a decline in net profits for the second quarter of 2024 as the airline progresses with its capital restructuring plan. The airline is preparing to submit a registration statement for the sale of securities and a draft prospectus to the Securities and Exchange Commission (SEC) of Thailand. This step is part of its strategy to complete a debt-to-equity conversion and a new share offering by the end of the year. These measures aim to ensure that the company reports “positive equity” in its 2024 annual financial statements, a crucial requirement for the success of its ongoing rehabilitation program.

 

Thai Airways and recorded a net profit of THB306 million  in Q2, a significant drop from the THB2.3 billion profit reported in the same period last year. The airline attributed the profit decline to several factors, despite a 17.7% increase in total revenue to THB44 billion. Passenger revenue alone grew by 15.9% year-on-year. However, this was counterbalanced by a 32.1% rise in operating costs, driven by the expansion of operations, increased raw material costs, and the depreciation of the Thai baht, which inflated foreign currency-denominated expenses. Additionally, exceptional items such as foreign exchange losses and asset impairments further impacted the financial results.

 

Thai Airways highlighted the expected boost in tourism, with the number of tourists to Thailand projected to increase by 25.9% to 35.5 million in 2024. This growth is partly attributed to the expansion of Thailand’s visa-free initiative on July 15.

 

For the future Thai Airways plans to add two more Airbus A330-300s to its fleet around November and will begin upgrading the cabins of its A320 aircraft in the fourth quarter. Airbus Services will manage the installation of 12 business class seats on each A320neo, transitioning the aircraft to a two-class configuration with 12 business class seats and 144 economy class seats.

 

As of June 30, had 77 active aircraft, along with one non-operational aircraft and 21 decommissioned planes slated for sale. The airline also recently placed an order for 45 Boeing 787-9s, scheduled for delivery between 2027 and 2033, as part of its fleet renewal and expansion plans. By 2033, Thai Airways aims to operate a fleet of 96 aircraft, with the potential to expand to 131 if all 35 additional Boeing 787 options are exercised.

 

 

-- 2024-08-12

 

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[edwinchester]

Need to hurry up and sell those weather damaged jets on the apron at Suvarnabhumi before they deteriorate into scrap metal.