Thai Airways International Plc (THAI) looks set to bottom out of three consecutive years of losses, following a net profit of 6 billion baht in the first quarter this year, thanks to cost cutting measures and lower fuel costs.

Though the total revenue of THAI and its subsidiary companies has reduced by 2.7% to 50.1 billion baht compared to that in the same quarter last year, THAI has been successful in capping total costs, bringing them down by 8.8% to 43 billion baht, THAI president Charamporn Jotikasthira said after a THAI board meeting yesterday.

Mr Charamporn attributed THAI's improving financial situation to the sharp drop in aviation fuel costs by 3.6 billion baht, down 25%, as well as continued measures to cut non-fuel costs by 524 million baht.

"We have to keep adding new marketing strategies to make us more competitive with our rivals," he said.

Stronger competition is a key factor that has lowered the national carrier's revenues. With the rapid growth of budget carriers competing for market share along with changes in technology and ticket pricing in the aviation industry, THAI could not avoid enduring ups and downs in its financial situation over the past decade.

The company was especially in the red for the past three years, encountering net losses of 13 billion baht in 2015, 15.6 billion baht in 2014 and 12 billion baht in 2013.

There was a dramatic moment last year when THAI suffered a net loss of 18 billion baht in the first nine months, raising fears it would post the biggest loss in its 56-year history. But a four-billion-baht surge in revenue in the fourth quarter last year saved THAI from such an unfavourable record.

THAI plans to leave behind its diminishing status this year, as a source said earlier the recovery has prompted the company to estimate a two-billion-baht profit this year.

Mr Charamporn's announcement of the first quarter's net profit is a good start for the company, assuring it is heading back on track.

During the first quarter this year, THAI used fewer planes but better managed their flight plans.

Source:
courtesy of BANGKOK POST

by Amornrat Mahitthirook

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