Thai Airways International Public Company Limited (THAI) and its subsidiaries announced its first quarter results of 2018 that had an operating profit of THB 3,836 million, 49.4% over the same period last year resulting from increase in revenue including a) passenger and excess baggage revenue, b) freight and mail revenue, and c) revenue from other activities. However, fuel expenses increased in line with rising jet fuel prices. The one-time expense for that quarter was mainly from impairment loss of assets and aircraft at THB 2,473 million. THAI had a THB 583 million gain on foreign currency exchange which was mainly from balance sheet revaluation. Consequently, THAI and its subsidiaries reported a net profit of THB 2,737 million.
Mrs. Usanee Sangsingkeo, THAI Acting President, said that THAI established a business transformation plan for 2018 with the objective to ensure continuous and sustainable operating results and to increase efficiency and improve quality of service to be comparable to global standards. The plan consisted of 5 core strategies: 1) Creating profits from increasing revenues, controlling cost structure by adopting low-cost business models, 2) Transforming business units to profit centers by seeking new business opportunities and increasing efficiency in asset management, 3) Improving and integrating service ring for better customer engagement, 4) Implementing digital applications to increase performance and got competitiveness, and 5) Developing human resources focused on organizational structure and culture, leadership, and human resource development. During that quarter, THAI and its subsidiaries received delivery of 4 new Airbus A350-900 aircraft that will be operated on intercontinental and regional routes. As of 31 March 2018, there are 104 aircraft in the fleet, with 9 more aircraft than the same period last year. Production traffic (ASK) increased by 4.9% while passenger traffic (RPK) increased by 2.2%. Average cabin factor was 80.6%, which almost matched the 80.9% industry average but lower than last year’s cabin factor of 82.8% with 6.25 million passengers carried, representing 4.1% less than last year.
THAI and its subsidiaries’ total revenue was THB 53,466 million, which increased by THB 3,662 million or 7.4% when compared to the same period last year, due to the increase in passenger and excess baggage revenue, freight and mail revenue, and increased revenue from other activities. Total expenses were THB 49,630 million, increased by THB 2,393 million (5.1%) on the back of the increase in fuel expenses by THB 1,189 million (9.3%) resulting from a 22.8% increase in jet fuel price. Non-fuel operating expenses increased by THB 1,280 million (3.9%) from last year mainly from the increased cost for aircraft repair and maintenance together with aircraft lease and spare parts due to the higher number of leased aircraft.
The one-time expense in this quarter was mainly from impairment loss of assets and aircraft at THB
2,473 million, resulting from the significant decrease in fair value of aircraft held for sale, especially the Airbus A340, which was assessed by standard appraisers. THAI had a THB 583 million gain on foreign currency exchange which was mainly from balance sheet revaluation. Consequently, THAI and its subsidiaries reported a net profit of THB 2,737 million, THB 432 million (13.6%) lower than last year. Profit attributable to owners of the parent was THB 2,717 million. Profit per share was THB 1.24, THB 0.21 or 14.5% lower than last year.
As of March 31, 2018, total assets were THB 286,169 million, an increase of THB 5,394 million (1.9%) from December 31, 2017. Total liabilities were THB 251,413 million, which was an increase of THB 2,651 million (1.1%) from December 31, 2017. Shareholders’ equity totaled THB 34,756 million, an increase of THB 2,743 million (8.6%) from December 31, 2017, due to profit from operations.