THAI Announces Operating Results 2020

25 February 2021

Mr. Chai  Eamsiri, Executive Vice President of Finance and Accounting Department,  Thai Airways International Public Company Limited (THAI), said due to the significant and unprecedented negative impact on international travel from the COVID-19 pandemic to the world aviation industry, in 2020, THAI and its subsidiaries recorded passenger production (ASK) decreased by 73.7% while passenger traffic (RPK) decreased by 78.5%. Passengers carried were 5.87 million people, a decrease of 76.1% from the previous year. For cargo transport, an average Freight load Factor was 58.6% higher than the previous year at 53.8%.

Total revenues of THAI and its Subsidiaries were THB 48,311 million while total expenses were THB 96,430 million, resulting in operating loss of THB 48,119 million and net loss of THB 141,180 million. One-time expenses, most of the figures are accounting figures which has no impact on cashflow of THAI, totaled THB 91,978 million consisting of;
- Impairment loss on aircraft, right-of-use asset and aircraft spare parts, amount of THB 82,703 million
- Loss for hedge of group of items with offsetting risk position, amount of THB 5,227 million
- Reserve employee compensation in the Mutual Separation Plan (“MSP A”), the amount of THB 3,098 million
- Loss on foreign exchange, amount of THB 895 million
- Impairment losses in accordance with TFRS 9, amount of THB 261 million
- Gain from changes in ownership interest in “NOK Airline PCL” of THB 206 million

THAI issued and implemented various measures to reduce costs and mitigate the impact from the COVID 19 situation, especially personnel expenses by asking for cooperation from management and employees to join the project on leave without salary and compensation (Together We Can Project). The two packages are the Mutual Separation Plan A (“MSP A”) and the Long term leave (“LW 20”) program. Both programs are intended to reserve as much cash on hand as possible for the company given the situation of no cash inflow from the aviation business and other sources of income.  THAI also halted investment and delayed purchases as well as reducing costs not related to operations, safety and guidelines mandated by law. The measures resulted in a decrease THB 15,000 million on fixed expenses from the previous year.

THAI seeks revenue by operating cargo flights and repatriation flights. In addition, THAI generated non-air revenue such as THAI catering.

On 14 September 2020, the Central Bankruptcy Court ordered THAI to rehabilitate its business and ordered the appointment of the planning committee as proposed. Later, the Receiver official announced the court order for business reorganization and set up of a group of planners in the Government Gazette on 2 October 2020, the plan preparers are currently preparing the rehabilitation plan with the permission of the Central Bankruptcy Court to submit the rehabilitation plan to the receiver official by 2 March 2021. After submitting the rehabilitation plan, the receiver official will hold a creditors meeting to consider the business rehabilitation plan. After which, the Central Bankruptcy Court will consider the business rehabilitation plan.