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THAI Announces First Quarter Operating Results 2014

May 19, 2014 Financial No Comments Email Email

Thai Airways International Public Company Limited (THAI) announced its first quarter operating results for 2014, a period that experienced a decrease in number of passengers due to the ongoing political protest in Thailand resulting in THAI and its subsidiaries incurring a net loss of THB 2,619 million.

Mr. Chokchai Panyayong, THAI Acting President, said that during the first quarter 2014, the Thai commercial airline industry was greatly impacted by the country’s ongoing political stand-off and the declaration of a state of emergency for the Bangkok and metropolitan vicinity impacting tourists’ confidence for personal safety, thereby resulting in the decrease in number of inbound and outbound tourists, especially regional tourists.

The political unrest in Bangkok had significant impact on THAI’s operating and financial  performance in the first quarter which is normally the high season for tourism travel but the number of inbound and outbound tourists dropped substantially compared to the same period last year by 17 percent, in particular a 27.1 percent reduction in Chinese tourist arrivals, 25.2 percent reduction in Japanese tourist arrivals, 12.9 percent reduction in Korean tourist arrivals, and 27.2 percent reduction in arrivals from ASEAN.  Revenue Passenger Kilometers (RPK) decreased by 12.6 percent and Available Seat Kilometers (ASK) decreased by 0.6 percent, which resulted in a cabin factor of 70.1 percent compared to last year’s 79.8 percent cabin factor achieved during the same quarter last year thus lowering operating revenue by 11.6 percent compared to the same period last year.  THAI has adjusted its business plan in order to respond to the operating environment to minimize the impact from the decrease in passenger travel.  The Company aims to enhance its revenue and is controlling its cost to improve its financial performance and support its business operations.

The consolidated financial statements for the first quarter of 2014 consists of THAI’s financial statement and five subsidiaries which are 1) THAI-Amadeus Southeast Asia Company Limited, 2) Wingspan Services Company Limited, 3) THAI Flight Training Company Limited, 4) Tour Eurng Luang Company Limited, and 5) THAI Smile Airways Company Limited that was incorporated on 17 October 2013 with 100 percent held by THAI but did not operate under its own airline code during this quarter.  During the first quarter of 2014, THAI and its subsidiaries posted a loss before foreign currency exchange and income tax (excluding impairment loss of assets and aircraft) of THB 3,287 million when compared to the reported profit of THB 4,271 million last year.  When combined with the impairment loss on assets and aircraft at THB 84 million, there was a decrease of THB 2,284 million compared to last year and a gain on foreign currency exchange of THB 990 million, a decrease of THB 5,139 million compared to last year, THAI and its subsidiaries incurred a net loss of THB 2,619 million during the first quarter of 2014 compared to a net profit of THB 8,295 million earned during the first quarter of 2013.

As of 31 March 2014, THAI’s total assets and its subsidiaries were THB 306,675 million, a decrease of THB 410 million of 0.1 percent from 31 December 2013.  Total liabilities totaled THB 252,374 million, which was an increase of THB 2,208 million or 0.9 percent from 31 December 2013.  Shareholders’ equity totaled THB 54,302 million, a decrease of THB 2,617 million from 31 December 2013.

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