THAI sees signs of an early turnaround as losses shrink
Thai Airways International (THAI) is banking on pulling out of bankruptcy protection and resuming trading of its shares earlier than planned as the carrier's bottom line is looking up.
Chai Eamsiri, THAI's chief of finance and accounting, said on Tuesday the airline has continued to slash expenses and is confident its revenue will keep growing this year as the pandemic has subsided and travel restrictions are easing.
The measures launched to streamline its operations and its improving financial performance are expected to enable the airline to emerge from financial rehabilitation and resume its stock trading sooner than was originally thought possible.
The Stock Exchange of Thailand (SET) has suspended the trading of THAI shares since May 18 last year due to the risk of it de-listing as a result of negative equity and signs of non-compliance (NC).
Mr Chai said on Tuesday the company has until 2025 to resolve the issues that forced it to be suspended from the SET. However, the carrier is determined to get things back on track much sooner, he added.
The recovery of global travel has narrowed THAI's losses to 3.1 billion baht in the first quarter of this year, down from 6.9 billion baht in the corresponding period last year.
This week, the International Air Transport Association (IATA) announced in Doha, Qatar, an upgrade to its outlook for the airline industry's 2022 financial performance as the pace of recovery from the Covid-19 crisis quickens.
Forecast highlights include:
Industry losses are expected to be reduced to US$9.7 billion (improved from the October 2021 forecast of an $11.6 billion loss) for a net loss margin of minus 1.2%.
That marks a huge improvement from a loss of $137.7 billion (-36.0% net margin) in 2020 and the $42.1 billion (-8.3% net margin) loss recorded in 2021.
As such, industry-wide profitability in 2023 appears within reach.
For Asia-Pacific airlines, strict and enduring travel restrictions, along with an uneven vaccine rollout, have seen the region lag in the recovery to date. As the restrictions diminish, travel demand is expected to increase quickly. Net losses in 2022 are forecast to decline to $8.9 billion.
On Tuesday, Mr Chai said THAI was also working on mobilising a fresh fund under the restructuring programme, which is making headway.
At the same time, the company will be selling its assets overseas worth around 2 billion baht as it shifts its focus to online ticket sales.
- Thai Airways