Expectations are high for Thai Airways International Plc (THAI) to to return on the Stock Exchange of Thailand (SET) in the coming year, as revealed by Tibordee Wattanakul, Director General of the State Enterprise Policy Office (SEPO). The liquidity of the national airline is improving, and operations are being systematically aligned with the rehabilitation plan. This positive shift is dependent on the airline posting 12 consecutive months of profit and generating positive equity.
The finance ministry has clarified that it has no intention of re-establishing the company as a state-owned enterprise, while it will still hold less than a 50% stake in the struggling national carrier. Despite this, the state remains the majority shareholder of THAI.
Tibordee noted the improvement in THAI’s financial performance as part of the rehabilitation program. The company has strategically contained its costs by cutting its workforce in half and reducing its fleet by approximately 40% through leasing.
The aviation industry faced a huge blow from the pandemic that lasted for more than two years, and one of the victims was THAILAND. In September 2020, the Central Bankruptcy Court approved a recovery plan after most of THAI’s fleet was grounded due to border closures, which halted air traffic. The airline’s total liabilities stood at 200 billion baht (US$5.6 billion) as of September 30, 2020, it said Bangkok Post.
In order to stay afloat, the airline implemented serious internal restructuring and initiated survival measures. This includes generating additional income from unrelated businesses such as food sales through THAI Catering, transportation of goods and sale of unused assets. Revenue was forecast to regain momentum as the pandemic recedes in mid-2022.
In the second quarter of 2023, the carrier reported a profit of nearly 2.3 billion baht ($64 million), a 20-year record and a 171% increase from last year. The airline is expected to complete the renovation by the fourth quarter of this year.
The revival of the tourism sector is crucial for the recovery of the aviation industry. The Office of Fiscal Policy announced on January 24 that the number of foreign tourists, primarily from China and Malaysia, is expected to reach 33.5 million this year, up from 28 million in 2023, marking a 19.6% increase. Tourism revenue is forecast at 1.48 trillion baht (US$41.5 billion), representing a 23.6% year-on-year increase.
In related news, THAI has addressed a passenger’s complaint about a business class seat mismatch. The airline overhauled its service model, communicated with affected passengers and improved ticketing transparency.
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