Troubled THAI falls to another major loss
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Thai Airways International (THAI) has suffered another significant quarterly loss, despite falling fuel costs and rising passenger traffic.
The national carrier fell to a net loss of THB9.89 billion (approx. US$275.7 million) for the three months ending 30 September 2015. This means that THAI has now suffered a cumulative loss of THB18.1bn for the first nine months of 2015.
THAI is currently undergoing a “Transformation Plan” aimed at restoring it to profitability. This has included the reduction of routes and flight frequencies, plus hundreds of job losses.
Despite these cuts, the airline carried a total of 5.15m passengers in the third quarter, up 8.8% year-on-year, while cabin load factors increased by 3.3 percentage points to 74.4%. Total revenues however, declined 4.4% to THB2.03bn, which THAI said was largely due to a sharp drop in cargo revenue.
The airline’s expenses were reduced by 6.1%, mainly due to lower fuel prices, while its operating loss for the quarter actually narrowed by 27.3% year-on-year to THB2.79bn.
But the airline was impacted by the weakening of the Thai baht against the US dollar, which led to a THB4.53bn foreign exchange loss for the quarter.
Meanwhile, the Bangkok Post reports that THAI staff have threatened strike action in protest against the airline’s cost-cutting plan. Rumours of the industrial action are reported to have spread via social media, including the airline’s own staff Line groups.
When he was appointed at the start of the year, THAI’s president Charamporn Jotikasthira vowed to return the national carrier to profitability by the end of 2016. But with the airline now having lost half a billion US dollars in the first nine months of 2015, despite the period coinciding with a sharp drop in fuel costs, the prospect of THAI returning to the black seems more distant than ever.
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