Thai Airways profits drown in flood wake

Thai Airways profits drown in flood wake
By admin


Thai Airways’ profits slumped in 2011 as severe flooding throughout Thailand towards the end of the year saw travellers ditch the destination.
Although the airline had been prepared to fall short of its 2011 targets with crucial European and Australian visitors staying away in what is traditionally its strongest quarter, the impact on its full-year results has been significant.
Profit before tax for 2011 fell 7,917 million baht ($243.79 million), a decrease of 126.7% on 2010 figures, despite revenue gains of 5.5%.
A statement from the airline said: “In 2011, Thai’s operations have been impacted by a number of external factors affecting its operating results since the first quarter of 2011 – the rapid rise in fuel price, the financial crisis in Europe and America, the earthquake in Japan in March leading to the tsunami and rounding off the year-end was the devastating flood in Thailand,”
While the airline had rationalised its flights to cope with the various adversities, it was unable to counteract the damage which saw its profitability plummet as its expenses shot up by 13% driven by a 38.7% increase in average jet fuel prices.
The airline also blamed the rapid expansion of low cost carriers and Middle East airlines that had forced it to adjust its marketing and operating strategies to cope with “heightened competitions.”
The airline carried 18.39 million passengers over the year, an increase of 1.2% on 2010. Capacity grew 4.1%, resulting in load factors slipping four percentage points to 65.4%.

 

Email the Travel Weekly team at traveldesk@travelweekly.com.au

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