Thai Airways announces third quarter results 2020

BANGKOK: Mr. Chansin Treenuchagron, Acting President, Thai Airways International Public Company (THAI), said that the COVID-19 pandemic continued to affect the world’s aviation industry. In the third quarter of 2020, there were slight signs of recovery from domestic travel; however, the figures presented a much lower number than normal levels.   The Thai tourism sector is still affected due to international travel restrictions in Thailand and other countries, whereby no inbound foreign tourists entered Thailand for the sixth consecutive month.

THAI continued to strengthen measures to reduce costs and mitigate the impact of COVID-19 from the previous quarter. THAI provided cargo transportation services in certain routes, including special flights that helped to repatriate Thai nationals.  The Company placed emphasis on earning non-related passenger revenue by penetrating the market to attract more local customers. Meanwhile, ThaiSmile, a subsidiary, resumed passenger services with domestic flights that began on June 1, 2020 onwards.

In the third quarter of 2020, THAI and its subsidiaries’ passenger production (ASK) decreased by 95.0%, while passenger traffic (RPK) decreased by 97.8%. Average cabin factor was 34.9% lower than last year, which was an average of 80.0%. A total of 0.49 million passengers were carried, a decrease of 91.9% from the previous year. For cargo transportation, freight production (ADTK) was 96.2% lower than the previous year, while freight traffic (RFTK) was 93.6% lower than the previous year. The average Freight Load Factor was 91.2% higher than the previous year, which was an average of at 52.2%.  

THAI and its subsidiaries had a total revenue of THB 3,727 million, lower than the same quarter of last year by THB 41,289 million or 91.7%. The main reason for the reduction was revenue from passenger and cargo transportation decreased by THB 37,654 million (95.1%). Revenue from other activities decreased by THB 1,718 million (56.2%). Total expenses were THB 19,375 million, THB 28,483 million or 59.5% lower than last year, mainly due to operating expenses that varied with traffic production, traffic demand, and the amount of passengers carried had decreased in line with production and traffic demand. Moreover, fixed expenses remained high, while revenue reduction decreased more than expense reduction, which was inadequate to compensate for the operating loss of THB 15,648 million, which was THB 12,806 million (450.6%) higher than the same quarter last year.

THAI and its subsidiaries had a one-time cost that consisted of:
• Impairment loss on fixed assets at the amount THB 444 million.
• Impairment loss in accordance with TFRS 9 at the amount THB 35 million.
• Foreign exchange loss of THB 5,306 million, which was mainly caused by accounting revaluation.
• Gain from hedging on a group of items with offsetting risk positions at the amount of THB 32 million.  

THAI and its Subsidiaries had a net loss of THB 21,531 million, a decrease of THB 16,851 million (360.1%) from the previous year. Loss attributable to owners of the parent company was THB 21,536 million, representing a loss of THB 9.87 per share compared to last year’s loss of  2.14 baht per share.

On September 14, 2020, the Central Bankruptcy Court granted THAI’s business reorganization petition and appointed the planner as nominated by THAI, At this time, the planning team is in the process of preparing the business reorganization plan. BIZ TODAY MONITOR