Flag carrier cuts costs by 44.8 billion baht
To return to making profits in 2023
Thai Airways International (THAI) has managed to cut costs by more than 44.8 billion baht this year and made a large portion of revenue from cargo transport, according to Piyasvasti Amranand, member of a THAI panel overseeing a court-monitored debt rehabilitation plan.
In the more than a year since rehabilitation was approved by the court, the airline has undertaken programmes to seriously curb costs and expenses while improving workforce and operational efficiencies, he told a press briefing on Monday on THAI's rehab progress.
Mr Piyasvasti explained the restructuring of the company was also aimed at increasing revenue while revising its corporate vision to maintain premium quality, full inflight services strengthened by Thailand's cultural identity and continue to connect with the world.
The airline has set out priorities, including keeping its costs of operation competitive and being a leader in commercial aviation.
Through its initiatives under the rehab programme, more than 400 projects and programmes were implemented, resulting in costs being brought down by more than 44.8 billion baht this year.
The figure accounts for 77% of the ultimate cost-cutting goal to be achieved via major business reform schemes.
From April to last month, when the country was battling a third Covid-19 outbreak, the carrier was able to earn revenue of more than 10 billion baht from transporting cargo and made 4.8 billion baht from serving some 80 airline customers.
The company expects to ramp up revenue stream from expanding its franchise of the Puff & Pie bakery and catering outlets.
Mr Piyasvasti said the flag carrier planned to raise as much as 50 billion baht in new capital as it expands flights during the country's reopening of borders to foreign tourists.
The airline will borrow 25 billion baht from existing creditors and other financial institutions and seek another 25 billion baht from the government, its biggest shareholder, he said.
"Our biggest problem is liquidity," Mr Piyasvasti said during the press briefing. "We need cash to run our operations."
THAI is looking to shrink its fleet size from 100 to 58 aircraft, which could net about 8 billion baht in cash, he said, adding the company expects to return to making profits in 2023.
"We have emphasised the need for new capital to creditors. We are confident that THAI's earnings will rebound sharply with big profit after the Covid-19 pandemic passes," he said.