Thai Airways Posts Lowest Profit In 4 Years

[george]

Thai Airways posts lowest profit in 4 years

BANGKOK: -- Thai Airways International, the country's biggest carrier, reported its lowest profit in four years in fiscal 2005 because of a rise in fuel costs.

Net income for the fiscal year ended Sept. 30 fell 33 percent to 6.78 billion baht, or $164 million, from last year's restated profit of 10.08 billion baht, the Bangkok-based airline reported in a filing to the stock exchange late Monday.

Revenue rose 6.5 percent to 162.5 billion baht.

Thai Airways, which removed the management powers of its president, Kanok Abhiradee, in August over its biggest quarterly loss in five years, has been seriously affected by oil price movements because the carrier hedged less than a third of its fuel purchases.

The airline's acting president, Somchainuk Engtrakul, faced a surge in fuel prices and a decline in passengers after the Dec. 26 earthquake-triggered waves, which in Thailand killed about 5,400 people. About half of those were foreign tourists.

The airline said its fuel costs rose 50 percent to 46.1 billion baht for the fiscal year. Its total operating expenses increased 15 percent to 151.7 billion baht.

Jet fuel traded in Singapore at an average of $63.68 a barrel in the year to Sept. 30, 53 percent higher than $41.52 a barrel a year earlier, according to the oil-pricing service Platts.

The price of jet fuel surged as much as 68 percent in the year to Sept. 30 after it rose to a high of $84.255 a barrel on Sept. 2.

Thai Airways' fiscal 2005 profit is the lowest since its 1.93 billion baht net income in 2001. For the fourth quarter, the airline had a 74 percent profit gain to 2.35 billion baht.

"The rebound in passenger numbers and fuel surcharge helped bring the company back to profit," said Kavee Chukitkasem, an analyst at Capital Nomura Securities in Bangkok.

The carrier may post at least 3 billion baht profit in the current quarter on lower fuel costs and peak travel season, said Kavee, who recommends investors buy Thai Airways stock.

Global airlines may report an industry loss of $7.4 billion this year, wider than a May estimate of $6 billion, while fuel bills surge to $97 billion based on an average oil price of $57 a barrel, according to a Sept. 13 forecast by the International Air Transport Association.

Thai Airways has been increasing its fuel surcharges and will have to raise its hedging to as much as 50 percent of total fuel purchases to reduce the impact of price swings, Somchainuk told reporters in an October briefing in Bangkok.

Fuel costs made up 29 percent of Thai Airways' total operating expenses in the first nine months.

The airline hedged 31 percent of its annual fuel needs, it said in May.

Thai Airways flew 18.13 million passengers in the 12 months ended Sept. 30, down by 7.2 percent from last year. It carried 564,052 tons of freight, a 4.9 percent increase from 2004.

The airline flew 4.58 million passengers in the fourth quarter, 4.4 percent less than a year earlier, according to its Web site. It filled an average 74.3 percent of seats with paying passengers for the quarter, lower than the 74.8 percent a year earlier.

--IHT 2005-11-29

[tuky]

Thai Airways International, the country's biggest carrier, reported its lowest profit in four years in fiscal 2005 because of a rise in fuel costs.

Whilst QANTAS made a record profit.

I fly Thai very often, I love the staff but I hate the small seats, the cramped legroom and the inflight entertainment, half of my flights are with Thai, the other with Emirates, I wish I could fly both ways Emirates as their passenger comfort level is on a completely different level. Thai need to lift their game to pick up their market share again.

Having siad that I wish them all the best fiughting against their rival carrier half owned by you know who

[britmaveric]

Lower prices - fill entire plane. Not hard concept make profits from volume. However this has yet to sink into Thai Airways.

[cclub75]

It's always the other's fault : tsunami, bird flu, oil price, the position of mercury planet etc...

Why just one time they could'nt say : "We screwed up" ?

Regarding Thai Airways : the problem is not the oil prices. The problem is : less people choose to fly Thai. And the real question is : why ?

If you use Emirates for instance, then the answer will be clear...

[Firefan]

Problem is ALSO all the "freebies" that ThaiAirways is forced to hand out to people of power and connections, especially due to their government ownership/control. That adds up to a lot of money.

Oh, and then crappy management too.

Cheers!

[astral]

At least they made a profit.

Some of the US airlines are in the RED.

[Rinrada]

At least they made a profit.

Some of the US airlines are in the RED.

<{POST_SNAPBACK}>

Dont know exactly what happened at T.G.check in on Saturday night (Heathrow) but K.wife sure as hill aint happy.

In all the years I have known her she has never complained (not polite and all that krup) especially if its anything to do with Thailand...ie..if its T related ..then it must be right... .. but not anymore. she was fuming....

Still cant get to the bottom of it but she told me yesterday that she spent most of Sunday writing a "letter of Complaint" to Thai Airways President.....Wot? her ideas on the writen scrip is usually reserved to the signing of a cheque,bankers draugh??or ensuring things like land transfer documents are in order ...o and court decisions ....very good at that she is.......but A "Complaint".....

In a nutshell she is demanding that all the check in in staff at terminal 3 be Sacked ...simple as that ......wonder what they did to pizz her off so much.....

Incid ..she is also a shareholder in the circus,a FF and holds a Goldie.........Mai Co jai....TG be very afraid (love that stupid expression) ...something to do with a seat????

[Ricardo]

So they only hedged 31% of fuel-consumption, when oil-prices were soaring, and they were cancelling flights to save on fuel.

And even now they only think they might like to hedge up to 50% in future.

To save time, abandon all hope of educating the current board, just sack the lot & cancel their life-time free-travel-on-TG priviledges.