Thai Airways targets mid-2021 for approval of turnaround plan

Thailand is Cambodia's neighbor to the West, and this forum is dedicated to Thai news, stories, reviews, blogs, videos, Thai people and anything else related to the country. A lot of expats have both lived and worked in Cambodia and Thailand, and this area is a place to discuss all aspects of life in Thailand and what's going on there. Most topics are about Bangkok and Pattaya because of their larger populations of expatriates and tourists in those cities, but this is for all things Thai.
User avatar
yong
Expatriate
Posts: 4267
Joined: Thu Mar 08, 2018 12:03 pm
Reputation: 2769
Thailand

Thai Airways targets mid-2021 for approval of turnaround plan

Post by yong »

https://asia.nikkei.com/Business/Transp ... 6&si=44594

Thai Airways targets mid-2021 for approval of turnaround plan
Carrier eyes revenue from COVID-19 vaccine flights and greater cargo demand

Image
Thai Airways planes sit on the tarmac at Bangkok's Suvarnabhumi International Airport. The airline is trying to generate revenue from cargo flights. © Reuters
APORNRATH PHOONPHONGPHIPHAT, Nikkei staff writerDecember 25, 2020 08:28 JST

BANGKOK -- Thai Airways International's turnaround plan is expected to receive court approval in mid-2021, at which time the flag carrier could proceed with debt restructuring, cost cutting and coronavirus-related projects designed to bring new revenue.

The plan being devised by the airline covers haircuts on company debt as well as the new revenue initiatives over the next few years, said Chansin Treenuchagron, acting president.

Thai Airways became one of the most prominent Asian corporate victims of the coronavirus pandemic this year as flights into and out of Thailand were frozen by the global travel restrictions. Now, the carrier is looking for the light at the end of the tunnel.

"Since the COVID-19 remains and the number of passengers is very low, we are trying to generate revenue from cargo flights," Chansin said.

"All projects are in the plan, which is due to be submitted for the court approval in April to May next year. That will make the plan immediately effective, and we are ready to start our job if the court approves the plan."

The country's Central Bankruptcy Court accepted Thai Airways' request for rehabilitation in September. The court-supervised restructuring will boost the airline's creditworthiness, but the carrier still must generate funds to carry it through the rehabilitation.

The sharp fall in passengers due to the COVID-19 pandemic slashed the company's fleet by 26%, with 17 to 25 aircraft operating. But rising demand for cargo flights is expected to lift the number of planes to 45 in 2021. The fleet is due to reach 75 in 2025.

Nond Kalinta, the company's acting executive vice president, said Thai Airways has conducted cargo flights to 25 to 35 cities this year since COVID-19 regulations were relaxed beginning in June, earning around 45 billion baht ($1.49 billion) so far. Cargo flights are projected to reach about 80 cities and generate around 135 billion baht in 2025.

The airline hopes to gain more revenue amid the pandemic, Nond said, including with flights carrying vaccine for Thailand and other clients in Southeast Asia.

Nond said Thai Airways owns refrigerated containers that can store vaccine at minus 20 C, matching the requirement for some vaccines. The company also has a logistics partner to help transport vaccine directly from airports to hospitals.

"Not only vaccine, but we can set up flights carrying specific medicine to our clients," Nond said, generating revenue in a time of few passenger flights.

The carrier's net loss for the quarter ended in September totaled 21.5 billion baht, widening from 4.6 billion baht in the year-ago period. Thai Airways recorded a net loss of 49.5 billion baht for the nine months through September.

Cash and cash equivalents shrank to 11.1 billion baht as of Sept. 30 from 21.6 billion baht at the end of 2019. The carrier had recorded negative cash flows from operations and investment and financial activities.

Thai Airways also is working to raise cash apart from the debt restructuring plan. The company put 34 passenger aircraft from its fleet up for sale, following measures such as introducing an early retirement scheme and franchising its popular deep-fried dough sold at the airline's food outlets.
User avatar
armchairlawyer
Expatriate
Posts: 2490
Joined: Sat Aug 29, 2015 1:43 pm
Reputation: 1503
Cambodia

Re: Thai Airways targets mid-2021 for approval of turnaround plan

Post by armchairlawyer »

Interesting. THAI moving to cargo only. At least it fixes the problem of the elite demanding free passage. Massive potential savings in staff costs.
Lots of government contracts to move vaccines to be awarded. But will they have to compete on price?
User avatar
Doc67
Expatriate
Posts: 8869
Joined: Thu Nov 16, 2017 9:16 am
Reputation: 8145
Location: PHNOM PENH
Great Britain

Re: Thai Airways targets mid-2021 for approval of turnaround plan

Post by Doc67 »

The plan being devised by the airline covers haircuts on company debt
I first heard this phrase when Greece defaulted and the talk was all about the size of "haircut" of bondholders. But what marketing genius came up with it?

When I get a haircut I pay $3, and have a vastly improved appearance. I get something of value for my $3 reduction in wealth.

The creditors are just being offered - correction - coerced by court decree to accept less than they are owed, so call it what it is; a partial default of debt. The only value the creditors are being offered is partial payment, with the threat of complete default as the alternative. That's coercion, not a beauty treatment.

Perhaps the Court should order a review of all seats gifted to the ruling elite over the last 6 years and order them to stump up the full fare retrospectively. That should ruffle some feathers.
User avatar
yong
Expatriate
Posts: 4267
Joined: Thu Mar 08, 2018 12:03 pm
Reputation: 2769
Thailand

Re: Thai Airways targets mid-2021 for approval of turnaround plan

Post by yong »

https://asia.nikkei.com/Business/Transp ... 7&si=44594

Thai Airways takes next step in balance sheet rehab plan
Carrier to cut registered capital by 19% as part of court-backed restructuring

Image
Thai Airways' rehab plan aims to bring the airline back to profitability by 2025, but much depends on recovery of the air travel market, which has been hit hard by the COVID-19 pandemic. © Reuters
APORNRATH PHOONPHONGPHIPHAT, Nikkei staff writerJuly 9, 2021 17:59 JST

BANGKOK -- Thailand's loss-making flag carrier Thai Airways International has proceeded with a plan to reduce its registered capital by 19% as part of a court-approved rehabilitation to improve its balance sheet.

The company will decrease registered capital from 26.9 billion baht ($822 million) to 21.8 billion by writing off unissued and unsold shares as stipulated in its rehabilitation plan, Suvadhana Sibunruang, the acting CEO, said on Friday.

The capital decrease is one step in the rehabilitation approved by the Central Bankruptcy Court in June. By decreasing its share capital the airline can reduce some accumulated losses and improve its financial condition.

The rehab plan consists of an organizational restructuring that will halve the company's pre-COVID workforce and cut executive positions by 30%. The airline has also been selling off aircraft, facilities and stockholdings as part of a review of its asset portfolio, and to raise working capital.

The company has said that it will continue to reduce its workforce by almost half and cut remuneration package expenses to return to competitiveness within three to five years. However, analysts said that will not be sufficient to repair its damaged balance sheet.

The airline needs a major cleanup, including new funds to tide itself over during the five-to-seven-year rehabilitation. Creditors have been reluctant to accept large losses as part of the rehabilitation process.

Thai Airways has only recorded annual profits twice in the past decade, and the rehabilitation program mainly deals with its unprofitable businesses. Some experts are also concerned about uncertainty in the air travel business.

Thai Airways posted a net loss of 141 billion baht in 2020 due largely to the COVID-19 pandemic, which has cut the number of passengers sharply. It carried 76% fewer passengers and 72% less cargo by volume in 2020 than the previous year, resulting in a 74% drop in its total operating revenue to 48.6 billion baht.

The rehab plan aims to bring the airline back to stable profitability by 2025. Meeting that target depends on the smooth execution of the rehabilitation and recovery of the air travel market.
[/img]
User avatar
Kammekor
Expatriate
Posts: 6375
Joined: Fri Sep 01, 2017 12:50 pm
Reputation: 2916
Cambodia

Re: Thai Airways targets mid-2021 for approval of turnaround plan

Post by Kammekor »

He Thai, remember my claim?
Post Reply Previous topicNext topic
  • Similar Topics
    Replies
    Views
    Last post

Who is online

Users browsing this forum: Amazon [Bot], KunKhmerSR and 177 guests