Airports too quiet for state agency owner

Corporate July 20, 2018 01:00

By The Nation

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STATE-OWNED airports were quieter than expected in the quarter to June, with a decline in the growth of passenger numbers from the corresponding period last year, prompting speculation that the World Cup may have been a factor.

 For April to June – the third quarter of the fiscal year – the growth in passenger numbers at airports run by Airports of Thailand (AOT) was just 4.5 per cent, the state agency said, adding that AOT airports have been asked to report on what may have caused the slump in growth.

The AOT, while releasing the June quarter passenger figures, also said it was planning more cargo services next year. In a related development, Team Consulting Engineering and Management Plc said it will focus on consulting services in Asean after the region’s gross domestic product (GDP) is likely to see expansion in the range of 5-9 per cent, fuelling expectations for a 3 per cent rise in the company’s income.

Nitinai Sirismatthakarn, president of the AOT, said that following the year-on-year drop in growth for passenger numbers for the fiscal third quarter, the agency has asked that all airports under its control look into reasons for the easing off in growth. Managers of the airports will report to the AOT board on their findings.

Nitinai said much of the decline for the quarter is expected to have come from Suvarnabhumi International Airport, with fewer flights in the quarter and the effect of the month-long football World Cup in Russia.

In regard to the recent tourist boat disaster off Phuket, he said that any impact would not be felt across the broader tourism sector as the accident – with the deaths of dozens of mostly Chinese visitors – had occurred outside the high season.

Some flights from China have been cancelled but other opportunities would present with bookings for flights on large aircraft from other countries including Russia and India, he said.

In the first two quarters of this fiscal year, starting from October 2017 to March 2018, AOT's income climbed 17-18 per cent and the growth figure is similar for the third quarter, Nitinai said.

The AOT's income is expected to grow 9-10 per cent for the whole of this fiscal year, as targeted, he said.

For the next fiscal year, starting from October, the company will focus more on cargo services for agricultural products, with the aim of making the country an air transport hub for the CLMV countries of Cambodia, Laos, Myanmar and Vietnam, he said.

The number of passengers using services at AOT airports is forecast to double from 45 million now to about 90 million in the next three years and the company will have to rush to construct two more airports in Lamphun and Phuket provinces, Nitinai said.

The AOT will also hold an auction for its duty-free concession, with the winner to be determined by the end of this year, before the current concession expires in September 2020, he said.

Chawalit Chantararat, president of Team Consulting Engineering and Management, said that due to growth in its integrated consulting services and a 5 per cent annual expansion in Thailand's consulting service business, the company is targeting income growth of 3 per cent per year.

The government, under its development policies, is set to hire a consulting firm for an amount of Bt2 million and for projects such as those related to the Eastern Economic Corridor (EEC) as well as the expansion of five border areas, which have been developed as special economic development zones, he said.

The company also has planned to expand into three more countries – Indonesia, Singapore and Brunei, in the Asean Economic Community (AEC), he said. Currently, it operates businesses in six other AEC countries aside from Thailand: Laos, Cambodia, Myanmar, Vietnam, the Philippines and East Timor.