Airlines ride high on tourism boom

Economy May 16, 2018 01:00


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EARNINGS posted by some of the country’s listed airlines point to a recovery in Thailand’s aviation industry in the first quarter of this year, including double-digit gains by pacesetter Bangkok Airways, amid a boom in tourist arrivals.

Bucking the trend is Thai Airways International Plc, which yesterday reported that net profit slumped 13.96 per cent to Bt2.71 billion from the same quarter of last year.

But overall, the gains mesh with a healthy picture for the aviation industry in the Asia Pacific region, which enjoyed a 9 per cent increase in passenger numbers from the year-earlier quarter. This outstripped the 7.2 per cent rise for the global market over that time, the International Air Transport Association said. 

The number of visitors to Thailand increased 15.4 per cent from the same period of last year, the Tourism and Sports Ministry said. These factors boosted the financial performance of Thai airlines for the year’s opening quarter, representing strong growth from the year-earlier period.

Bangkok Airways Plc reported to the Stock Exchange of Thailand yesterday that the number of passengers it carried rose 8.4 per cent from the same quarter in 2017. International passengers accounted for 56 per cent of the total. The increase reflects the extra business from a number of code-share agreements the carrier has struck with partners.

The company also added more routes to serve customer demand for new destinations. This resulted in increases in the number of passengers it flew and the load factor it achieved.

With the rising passenger numbers and load factor, the reported total revenue of Bt7.83 billion and net profit of Bt719.3 million, up 4.8 per cent and 27.3 per cent, respectively, from the same period of last year.

Asia Aviation Plc (AAV), a major shareholder of Thai AirAsia Co Ltd (TAA), reported total revenue for the three months of Bt11.64 billion and net profit of Bt1 billion. For TAA, the same total revenue was booked, but its net profit was higher – at a record Bt1.83 billion for the carrier.

TAA achieved a load factor of 91 per cent, up 2 percentage points from the prior corresponding period. It carried 5.64 million passengers, up 16 per cent, shading the 15 per cent growth recorded for seat capacity.

Asia Aviation Plc chief executive officer Tassapon Bijleveld said recently that TAA saw continued growth in the first quarter of this year, mainly due to its enthusiastic work in the domestic market, especially in the secondary provinces in support of the government's tourism promotion policies. Thai AirAsia started operating seven new routes during the quarter: from Bangkok (Don Mueang) to Ranong, Johor Bahru, Chengdu and Chumphon; from Phuket to Macau and Kunming; and from Chiang Mai to Udon Thani. 

It also increased flight frequencies on 12 routes from Bangkok (Don Mueang) and Pattaya (U-Tapao), while Bangkok (Don Mueang) to Tiruchirappalli, Chiang Mai to Ubon Ratchathani and Ubon Ratchathani to Pattaya (U-Tapao) were suspended as a result of what the firm called route revenue and capacity management.

For the second quarter of 2018, Tassapon said TAA would increase flight frequencies on popular routes. For 2018, it aims to serve 23.2 million passengers, maintain a load factor at 87 per cent and add seven aircraft to bring its fleet to 63. This would ensure another strong performance and returns for this quarter.

Nok Airways Plc narrowed its losses in the first quarter from the same period of last year, booking a net loss of Bt26.88 million. That compares with a net loss of Bt295.57 million in the first quarter of 2017.

Nok Airways chief executive officer Piya Yodmani said the company’s revenue grew 5.6 per cent from the same quarter of last year to Bt4.32 billion as the average cost per seat declined, cabin factor improved and more passengers were carried, despite the rise in fuel costs. “The result is better than expected and it clearly shows that our business turnaround plan has continued to bear fruit and the company is on the right course,” Piya said.