Thai Airways International's Outgoing President Piyasvasti Sends Last Message To Employees

[webfact]

THAI

Piyasvasti sends last message to employees

The Nation

BANGKOK: -- Thai Airways International's outgoing president Piyasvasti Amranand today sent a universal e-mail, bidding a goodbye to all 25,000 employees as his employment contract will be ended this month.

He earlier scheduled for a meeting with employees in the afternoon. That was cancelled.

In the "DD’s Talk" e-mail, he said that through the 2 years, 8 months and 2 days as president of the national carrier, he was pleased and honoured to work with many employees who demonstrated talent and integrity. It was a tough job but he was proud that he ably turned around THAI and established the good governance system. Notably, his plans won supports from the employees. What worries him now is that all the plans could be derailed as the board of directors sought to re-establish their power over the management.

Here are some excerpts from the e-mail.

"I’m confident that I have followed through the set principles, policies and planning, which establishe the foundation of sustainable growth. From Bt21 billion loss in 2008 and Bt1.6 billion loss in the first nine months of 2009 which spiked the debt to equity ratio over 3 times, the performance has improved with the D/E ratio at 2 times. THAI was recapitalised in 2010 and won sufficient loans with "considerably good" terms."

"Aside from first quarter net profit of Bt3.6 billion, the performance in April was positive under tough competition. Several leading airlines suffered from first-quarter losses, like Singapore Airlines, Korean Air, and Lufthansa. Even Chinese airlines also witnessed lower profits."

"I’m confident that the number of passengers and cabin factor of THAI in the second quarter would be the highest in five years for THAI, despite fierce competition and sluggish demand in Europe."

"Expense cuts, which were supported by all employees, attributed to the first-quarter net profit.... In some cases, the company may cut a tiny amount, but this sets a new standard for cooperation. I’d like to thank all employees and executives for this, as without cost cutting, we would not have shown profits and the company’s sustainability would not be assured."

-- The Nation 2012-06-20

[Moruya]

A victim of his own successes.

How can Thai appoint Priewpan in the same breath?

[theblether]

Thailand does have quality businessmen, if only the politicians would leave them alone to do their job.

[SuneeTH]

A victim of his own successes.

How can Thai appoint Priewpan in the same breath?

A victim of his own wife. (He also got that wife because of his wife relationship with Mark)

The DEM MP Khun Arnik, close friend of Mark at Oxford.

[fstarbkk]

Clearly, the old adage "if it ain't broke, don't fix it!" doesn't have many supporters.

It's more like "if the Dem's fixed it, let's be sure to break it right quick!"

[tx22cb]

A victim of his own successes.

How can Thai appoint Priewpan in the same breath?

A victim of his own wife. (He also got that wife because of his wife relationship with Mark)

The DEM MP Khun Arnik, close friend of Mark at Oxford.

Point of Order: I question the assertion "close friend of Mark at Oxford". Abhisit is 47 years old, Anik is 55, and both were undergraduates. Hence I do not think they were contemporaries whilst at Oxford.

[rotary]

I heard he really only sent an SMS to employee's saying: MOVE TO DON MUANG

[geriatrickid]

Has anyone read the Thai financial statements? The reason for this man's termination is laid out in the numbers.

One should not comment on hidden motives unless one has read the financial statements and reviewed the stock highlights. Start here;

http://www.set.or.th/set/companyhighlight.do?symbol=THAI&language=en&country=US

Two statements in this article jump out at me;

1. He was proud that he ably turned around THAI and established the good governance system.

2. The board of directors sought to re-establish their power over the management.

1. Thai Airways has not turned around.

2010 was a stellar year for airlines around the world. Even the battered US Airline industry collectively reported US$3.95 Billion in profits.

Thai reported approx B15,350 Million in profits. A decent result, and the stock price reflected it, trading at 49 baht.

And then 2011;

Thai Airways recorded a B10,196.97 Million loss and a sharp drop in the share price to 20 Baht.

Yes Q1- 2012 results are positive, at B3.65 Million in profit. A profit is to be expected in Q 1 because Q1 is in high season when profitable longhaul flights are at their peak.

This year's Q1 profit was up by about 16% over last year. It's good, but not good enough. The profitiability had to be much higher if TG was to avoid another big loss in 2012. However, sares are still depressed, trading at 22.50 baht.

Typically, when the finnacial results of a company are not good, investors demand action and it's usually for the head of the executives in charge. The lifespan of the typical big public company President is not long.

Reference is made to good governance. I suppose this is a referral to the management of the company. Unfortunately, what was managed eludes me. Actual revenues were up last year, which makes the incurred loss even more difficult to swallow. Bloomberg explains it nicely;

An increase in the percentage of sales devoted to cost of goods sold from 76.84% to 83.80% was a key component in the falling bottom line in the face of rising revenues. In plain language, his claims to reducing costs are contradicted by the actual financial statements.

And this brings us to point 2.

In consideration of the poor financial results and an indication that TG was on its way to another loss, what would any responsible BoD do?

Of course the board had to take control. It is called good corporate governance and a fiduciary duty.

In respect to the comments of government interference, it seems that some people neglect the fact that there are independent directors and outside investors. Can anyone cite objections from the independent directors or non government shareholders? If anything, investors would have been demanding action, a shakeup.

[webfact]

THAI

Piyasvasti files lawsuit over 'unfair' firing

The Nation

Piyasvasti

BANGKOK: -- Thai Airways International's former president Piyasvasti Amranand will today file a lawsuit against the company's "unfair dismissal order", which terminated his employment contract a year before it was due to expire.

He told reporters yesterday that the Central Labour Court would be asked to rule on two options: THAI must reinstate him as the airline's president or the company must pay compensation until his employment contract actually ends on July 11, 2013.

"Money is not the issue here, but I'd like to set the management standard for state enterprises, for the sake of transparency," he said.

The THAI board of directors late last month decided to terminate his contract prematurely. As he was notified a month in advance with a six-month compensation package accordingly to the contract's conditions, yesterday was his last day in office.

Asked whether he would also sue Ampon Kittiampon, chairman of the board, Piyasvasti acknowledged that this was under consideration.

Ampon in May cited lack of communication unity with the board for the dismissal, only to announce days later through acting president Chokchai Panyayong that conflicts over a plan to acquire new aircraft was the reason. To the House of Representatives committee on transport, at a meeting attended by Piyasvasti, Ampon reiterated the aircraft conflict.

Against Ampon's words that it was a golden handshake, Piyasvasti spent his last day in a gloomy mood. Piyasvasti planned a speech to employees at the auditorium, but there was an order that he should not be granted access. Instead, he wrote a five-page statement as the last communication from the president, which was mailed to 25,000 employees. There was also an order to cancel the management team's farewell luncheon.

Speaking to a small group of employees meeting with him in the afternoon, Piyasvasti thanked them for their support of the cost-cutting measures introduced during the past 32 months.

"The board approved all the measures, but the chairman said no to the proposed 50-per-cent cut in directors' meeting allowance," he said, to the employees' applause.

In his last communication to employees, Piyasvasti said his decision to waive all allowances from THAI board meetings, other THAI committees, and Nok Air board meetings persuaded the employees to embrace cost-cutting measures. Still, he said that as the board showed little support for this, the president's sacrifice should be ended too.

He attributed the first-quarter net profit to the cost-cutting measures.

"Without cost-cutting, we would not have shown profits and the company's sustainability would not be assured ... I have never been offended, being called 'Piyaprayad' [super-saving Piyasvasti]. I'm proud and very fond of this name. We have to admit that our efficiency is comparatively lower than other airlines, because of high expenses. Under the volatile and high fuel price and fierce competition from premium airlines ... and low-cost airlines, I have to thank all for their support and sacrifice."

Piyasvasti said he was pleased with improvement measures introduced during the past two years, eight months and two days, which resulted in a stronger financial position. With 58 new aircraft to be delivered between this year 2017, it marks the first fleet expansion in five years. As the average aircraft age is reduced from 11-12 years two years ago to eight in the next five years, higher energy efficiency will boost the company's margin, as fuel accounts for 40 per cent of operating cost, he said.

"With consistently good products, THAI's aim to be one of top five airlines is within reach. Unfortunately, Skytrak [the airline rating agency] just informed us that it was indefinitely delaying the consideration of re-rating after the president's dismissal," he said.

The former president said he was proud that he had turned around THAI and established a system of good governance, with support from employees. What worries him now is that all the plans could be derailed as the board of directors seeks to re-establish its power over the management.

While saying there was an attempt to get rid of him even before the appointment, he reiterated that the chairman's reason for dismissal was ambiguous. He also urged all employees to look into the minutes of the executive committee's March 5 meeting and the minutes of the Audit Committee's meetings on March 30, April 18 and May 10.

"Though it is a state enterprise, THAI is a listed company and belongs to all Thais ... Thus the general public, employees and shareholders are entitled to the actual reason for the termination."

-- The Nation 2012-06-21

[laurentbkk]

Can I fill up also a complain to TG for very bad business class ?

[geriatrickid]

"Though it is a state enterprise, THAI is a listed company and belongs to all Thais ... Thus the general public, employees and shareholders are entitled to the actual reason for the termination."

Although the majority shareholder has the right to appoint some directors, the other shareholders elect the other directors and those directors represent their respective interests. There are also 6 Independent Directors.

Is this guy out to lunch? His contract of service was terminated, just like when other TG employees are terminated, except in this case he received a much more generous severance package. Now he files an employment practices liability suit. Good luck on that.

[Moruya]

"Though it is a state enterprise, THAI is a listed company and belongs to all Thais ... Thus the general public, employees and shareholders are entitled to the actual reason for the termination."

Although the majority shareholder has the right to appoint some directors, the other shareholders elect the other directors and those directors represent their respective interests. There are also 6 Independent Directors.

Is this guy out to lunch? His contract of service was terminated, just like when other TG employees are terminated, except in this case he received a much more generous severance package. Now he files an employment practices liability suit. Good luck on that.

So how come they employed Priewpan Damapong out of the blue? Royal Thai Police Chief and brother of Thaksin's wife Pojaman?

Is it so he has lots of income when he retires from yet another position that family got him as police chief?

Nepotism at its absolute worst.

[geriatrickid]

So how come they employed Priewpan Damapong out of the blue? Royal Thai Police Chief and brother of Thaksin's wife Pojaman?

Is it so he has lots of income when he retires from yet another position that family got him as police chief?

Nepotism at its absolute worst.

Are you aware that there were approx. 4600 shareholders in attendance at the April 25 annual meeting? They elected the directors and one of them was PREOPHAN DHAMAPONG. He was re-elected. I believe he is there because he has a background in administration and oversight.

Were there other equally qualified candidates? Probably. However, there isn't a board that doesn't invite people to stand for election on the basis of friendships or connections. Even the most honourable of companies have boards that look incestuous. You should have a look at the board of some major airlines for comparison purposes.

I suggest you have a look at page 78 of the annual report. He distinguished himself as the Chairman of the Good Governance Committee. He was asked to stand for election last year by the majority shareholder, the Ministry of Finance.

[Moruya]

Has anyone read the Thai financial statements? The reason for this man's termination is laid out in the numbers.

One should not comment on hidden motives unless one has read the financial statements and reviewed the stock highlights. Start here;

http://www.set.or.th...e=en&country=US

Two statements in this article jump out at me;

1. He was proud that he ably turned around THAI and established the good governance system.

2. The board of directors sought to re-establish their power over the management.

1. Thai Airways has not turned around.

2010 was a stellar year for airlines around the world. Even the battered US Airline industry collectively reported US$3.95 Billion in profits.

Thai reported approx B15,350 Million in profits. A decent result, and the stock price reflected it, trading at 49 baht.

And then 2011;

Thai Airways recorded a B10,196.97 Million loss and a sharp drop in the share price to 20 Baht.

Yes Q1- 2012 results are positive, at B3.65 Million in profit. A profit is to be expected in Q 1 because Q1 is in high season when profitable longhaul flights are at their peak.

This year's Q1 profit was up by about 16% over last year. It's good, but not good enough. The profitiability had to be much higher if TG was to avoid another big loss in 2012. However, sares are still depressed, trading at 22.50 baht.

Typically, when the finnacial results of a company are not good, investors demand action and it's usually for the head of the executives in charge. The lifespan of the typical big public company President is not long.

Reference is made to good governance. I suppose this is a referral to the management of the company. Unfortunately, what was managed eludes me. Actual revenues were up last year, which makes the incurred loss even more difficult to swallow. Bloomberg explains it nicely;

An increase in the percentage of sales devoted to cost of goods sold from 76.84% to 83.80% was a key component in the falling bottom line in the face of rising revenues. In plain language, his claims to reducing costs are contradicted by the actual financial statements.

And this brings us to point 2.

In consideration of the poor financial results and an indication that TG was on its way to another loss, what would any responsible BoD do?

Of course the board had to take control. It is called good corporate governance and a fiduciary duty.

In respect to the comments of government interference, it seems that some people neglect the fact that there are independent directors and outside investors. Can anyone cite objections from the independent directors or non government shareholders? If anything, investors would have been demanding action, a shakeup.

You are not reporting correctly and are losing several zeros.

Please see their income statements http://www.bloomberg.com/quote/THAI:TB/income-statement

[Moruya]

So how come they employed Priewpan Damapong out of the blue? Royal Thai Police Chief and brother of Thaksin's wife Pojaman?

Is it so he has lots of income when he retires from yet another position that family got him as police chief?

Nepotism at its absolute worst.

Are you aware that there were approx. 4600 shareholders in attendance at the April 25 annual meeting? They elected the directors and one of them was PREOPHAN DHAMAPONG. He was re-elected. I believe he is there because he has a background in administration and oversight.

Were there other equally qualified candidates? Probably. However, there isn't a board that doesn't invite people to stand for election on the basis of friendships or connections. Even the most honourable of companies have boards that look incestuous. You should have a look at the board of some major airlines for comparison purposes.

I suggest you have a look at page 78 of the annual report. He distinguished himself as the Chairman of the Good Governance Committee. He was asked to stand for election last year by the majority shareholder, the Ministry of Finance.

Of course!

There is a Thatcher, a Brown, and a Cameron on BA's board

And several Bushes on AA and UA

Silly old me!

[Lite Beer]

Sacked national airline president files suit for unfair removal

BANGKOK, June 21 – The former president of Thailand’s flag carrier Thai Airways International (THAI) has filed suit at the Central Labour Court in Bangkok charging that the company’s board unfairly removed him as president and chief executive officer, and is seeking compensation of Bt10 million or reinstatement.

The THAI board of directors resolved on May 21, with 12 of its 13 members voting, to terminate Piyasvasti Amranand’s employment contract, effective this month, and to compensate him with six months of his then current salary. The compensation was estimated at Bt6 million.

Citing communication problems as the main reason, board chairman Ampon Kittiampon explained that the panel made its dismissal decision despite Mr Piyasvasti passing his performance assessment with a high score.

Piyasvasti said that the main reason for petitioning the court is that he wants the state enterprise to have a high standard and good governance, particularly because THAI is a listed company.

He said that the THAI board citing communication problems and the differences regarding the procurement of new 38 aircraft as reasons for his contract termination were not clear enough because his key performance indicator (KPI) evaluation was 87 per cent and that THAI profits were Bt3.6 billion during the 1st quarter of 2012.

He could not confirm whether there was political motivation involved in his removal, but the THAI board chairman himself must clarify the decision to the public, otherwise reinstate him to his former positions.

The court set his first hearing on July 24 at 1pm. (MCOT online news)

-- TNA 2012-06-21

[SuneeTH]

A victim of his own successes.

How can Thai appoint Priewpan in the same breath?

A victim of his own wife. (He also got that wife because of his wife relationship with Mark)

The DEM MP Khun Arnik, close friend of Mark at Oxford.

Point of Order: I question the assertion "close friend of Mark at Oxford". Abhisit is 47 years old, Anik is 55, and both were undergraduates. Hence I do not think they were contemporaries whilst at Oxford.

In Thailand, it is not polite to disclose an old woman's age.

And how many wrinkles has she got already?

I suppose she now weigh 7 and a half stones.

[TheCure]

I will not comment on his performance compared to other airlines' CEO's, but being TG Platinum I can say that under his tenure there has been a significant improvement in customer service levels and overall experience as a very frequent TG patron .

[geriatrickid]

You are not reporting correctly and are losing several zeros.

Please see their income statements http://www.bloomberg...ncome-statement

Bloomberg converts. The numbers I used are from the SET and as I wrote are in Millions. Go and look at the SET link.

[tombkk]

Citing communication problems as the main reason, board chairman Ampon Kittiampon explained that the panel made its dismissal decision despite Mr Piyasvasti passing his performance assessment with a high score.

Communication problems, not performance problems. He did a good job, but he was honest and outspoken.

I am not surprised that his lack of kow-towing finally cost him his job (I would have hoped against better knowledge that he would have stayed longer), but I do think that at a severance pay of THB 6m, he should call it a day and not go to court to try and get more.

Unless he donates it to a good cause, so it does not look like greed.