THAI's profits take Q1 nosedive
- 17 May 2019 at 06:12
- WRITER: THODSAPOL HONGTONG
Thai Airways International Plc (THAI) has blamed the appreciation of the baht, the US-China trade war and the closure of Pakistani airspace for a 83% dive in its year-on-year first-quarter profits.
The national carrier on Thursday announced its financial statement for the first quarter of this year.
It reported a net profit of 456 million baht, down from a 2.7 billion baht profit in the first three months of last year. It posted revenue of 49.7 billion baht, down 6.9% on the same period last year.
THAI president Sumeth Damrongchaitham said the fall is caused by the strong appreciation of the baht against major currencies, which made it impossible for the airline to raise air ticket prices.
"Although the baht's appreciation helped lower some expenses, including loan payments and lease payments for aircraft and engines, this benefit remains minimal," he said.
The trade war between the United States and China also took a toll on the airline's cargo business, which saw earnings drop 12.9%, Mr Sumeth said.
The airline was also affected by the closure of Pakistani airspace in late February following clashes with India, Mr Sumeth said, noting THAI aircraft needed to make detours, which pushed up fuel costs. The airspace has since been partially opened.
According to the THAI president, the airline utilised an average of 90 aircraft during the first quarter, four fewer than in the same period last year.
The airline plans to sell products on its website and mobile app in September to increase revenue.