THAI may miss Bt180 bn revenue goal

[webfact]

AVIATION
THAI may miss Bt180 bn revenue goal
Suchat Sritama
The Nation


THAI president Charamporn Jotikasthira answers questions after announcing a second-quarter net loss of Bt10.2 billion.

BANGKOK: -- Thai Airways International (THAI) President Charamporn Jotikasthira said yesterday that the airline may not achieve the Bt180-billion revenue targeted for this year, amid delay in some cost-cutting plans and the occurrence of several non-current expenses during the year.

He pointed out that the carrier would be unable to meet its plan to cut costs by Bt10 billion this year. In the first half, the airline failed to cut any costs, but still hopes it will be able to cut Bt5 billion over the rest of the year.

Yesterday, THAI reported a net loss of Bt12.76 billion in the second quarter. Of the total, Bt3.7 billion was on account of early-retirement programmes and another Bt3.68 billion from foreign exchange losses.

Thanks to flight adjustment plans, the airline saw a 20-per-cent rise in the number of passengers in the quarter and an 11-per-cent increase in Revenue Passenger-Kilometre (RPK). The cabin factor rose from 63.5 per cent last year to 69.2 per cent. Yet, total revenue

dropped by 4 per cent on year to Bt41.8 billion due to the decommissioning of cargo aircraft. Total expenses showed a 9-per-cent drop to Bt45 billion, thanks mainly to the lower fuel prices.

According to Charamporn, the airline would lower its load-factor projection for this year the initial forecast of 85 per cent to 76 per cent. The revised forecast will still be higher than the 71 per cent seen last year.

To gain more passengers, the airline plans to open several new routes to China, which has become one the top four markets for THAI.

Narongchai Wongthanavimok, the airline's executive vice president and chief financial officer, said the company had been considering selling properties in Thailand and overseas, particularly offices and staff residences, and divesting shares in other business. Properties to be sold could be worth up to Bt10 billion.

Details of the plan will soon reach the board of directors for consideration.

Last year, the airline sold 10 old aircraft as part of its cost-cutting plans. So far this year, it has sold another 17 planes. It is placing 21 aircraft on the market for sale.

Meanwhile yesterday, Asia Aviation, major shareholder of Thai AirAsia, said its earnings for the second quarter were Bt6.8 billion, up 26 per cent year on year. Net profit was Bt374 million, reversing losses from the same period of last year on the back of higher average fare income due to greater demand and lower average fuel costs. In the first half, revenue was Bt14.6 billion and net profit Bt1.2 billion.

Bangkok Airways yesterday reported that its revenue in first half was Bt12.2 billion, up 12 per cent from Bt10.9 billion in the first six months of last year.

Source: http://www.nationmultimedia.com/business/THAI-may-miss-Bt180-bn-revenue-goal-30266533.html

-- The Nation 2015-08-14

[ezzra]

It is a surprise that they make any money at all given their bloated and aging, unionized workforce,

they should take a leaf how ANA, Cathy, Singapore airline and Korean airlines service their customers,

flawlessly and unreservedly and with a smile.... and don't get me started on their airfares....

[BSJ]

Why am I not surprised!

[Ricardo]

What counts is profits, not revenues, but perhaps he sees this as a matter of face ?

[Thian]

As long as i have to pay the 180 baht for every ATM transaction i won't fly Thai. Let's see who has the longest breath.

[shirtless]

They could still be losing money whats your net profit thai

[SoilSpoil]

Dear people at Thai,

Your ground and check in staff are rude, ignorant and have no clue how to make customers feel at ease.

A lot of your planes are not using the gates on arrival. Taking an airport bus to the terminal is not practical for elderly or in my case with young children.

Trying to communicate with your service department is almost impossible, both in English or Thai, emails stay unanswered and we literally record all phone conversations with you as back up. Too often we received incorrect information.

I used Thai Airways a lot in the past but due to your poor service level, I now only fly Thai when there's no alternative. Your services are among the most expensive while your service level is that of a very low cost carrier.

All the best with your operations,

Soil

Edited August 14, 2015 by SoilSpoil

[waza]

Unbelievably bad service on Thai, yesterday they had 20 staff at first class check in servicing no passengers and 10 counter staffed in economy servicing over 1000 customers. The cue went out of the airport door. I asked the manager why he couldn't move some staff to ease the backlog, he just smiled at me and said, "but that is first class".

[Seastallion]

"THAI reported a net loss of Bt12.76 billion in the second quarter. Of the total, Bt3.7 billion was on account of early-retirement programmes and another Bt3.68 billion from foreign exchange losses."

3.7 BILLION to people who made decisions that resulted in 3.68 BILLION in losses.

That makes sense.

And that's just in one quarter, 3 months.

Edited August 14, 2015 by Seastallion

[sammygood]

why don't they just disban the whole THAI float and leave it to the professionals ?

[steelepulse]

Well at least they can find excuses that might be believable to those with blinders on, but no one with a couple brain cells thinks the "foreign exchange losses" and "early retirement" are the driving factors behind the nosedive.

[baboon]

I booked a ticket from the UK last week. I remembered posters on a previous thread saying THAI fares were quite competitive at the moment so I logged onto their website for a quote, but no dice after several attempts. Fair enough, five minutes later BA had my money. Clearly they wanted my business unlike THAI.

[Srikcir]

"In the first half, the airline failed to cut any costs"

There's the answer to why it cannot reach its revenue goal and likely NEVER to do so.

The government needs to divest itself of THAI stock and let the airlines land wherever the winds of losses takes it.

[khunpa]

What was once one of the best airlines in the world, has become one of the worst.

Pretty much reflects the overall situation of Thailand in general.

[trainman34014]

NO SAVINGS were made in the first half of the year. Why then is the CEO not being called in by the General to explain why no savings have been made after all the bullshit that has been spouted about cost cutting? Easy answer.... they are gutless wonders running the company afraid to make the 40% staff cuts needed because of all the 'connected' people having jobs, many of them from Military families.

No worries; within a few years Thai will only be operating internal flights and flights to China and North Korea as the rest of the World will boycott them.