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Thai Airways posts $274m loss in Q2


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August 15, 2008

Thai Airways posts $274m loss in Q2
Thai Airways International (TG), Thailand’s national flag carrier, posted a huge loss of 9.23 billion baht ($274.3 million) in the second quarter, due mainly from soaring fuel costs, reported AFP on Thursday.

The figure is the biggest quarterly loss in a decade and far higher than the same period last year when the airline lost 417 million baht.

“The main reason was the sharp rise in the price of jet fuel by 73 percent, causing the company’s fuel costs to rise sharply,” Ngamnit Sombutpibool, TG’s vice president of accounting, said in the company’s statement on Thursday.

An unexpected depreciation of the company’s new aircraft and financial losses caused by a weakening of the Thai baht against the dollar have contributed to the company’s bad fortunes, Ngamnit said.

The airline plans to lay off 400 staff, mainly through an early retirement programme, which would cost about 700 million baht and be paid for by reduced investment, the company’s president Apinan Sumanaseni was quoted by AFP as telling The Nation newspaper.

“At the meeting yesterday, the board also approved plans to reduce direct flights to Los Angeles and other routes to cut losses,” Apinan said.

Thai Airways International’s total operating revenue in the second quarter was 50.29 billion baht, up 13 percent year-on-year, while its operating costs were 54.74 billion baht, up 20.3 percent from the same period last year, the statement said.

The airline lost 6.99 billion baht in the first half of this year, including 5.69 billion baht lost on foreign currency exchange.

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