Thai Airways Flags Investor Confidence as Key Hurdle Despite Strong Q1 Turnaround

As the airline eyes a return to stock market trading in the latter half of July, executives acknowledge the challenge of reassuring investors amid volatile capital markets, while highlighting a significant first-quarter profit

 

Thai Airways International (THAI) faces a crucial test in regaining investor trust as it prepares to relist on the Stock Exchange of Thailand, according to Piyasvasti Amranand, chairman of the airline's Business Rehabilitation Plan Executive Committee.

 

Speaking on Friday, Piyasvasti underscored that unpredictable capital market conditions present a significant obstacle to a successful return.

 



 

 


"While we aim to resume trading in the second half of July, the prevailing capital market is beyond our control," Piyasvasti stated. "Therefore, we cannot offer guarantees on investment returns. Crucially, rebuilding investor confidence in THAI is paramount. The recurring question since our relisting announcement is whether THAI will revert to its previous state. The incoming board of directors must demonstrate convincingly that THAI has fundamentally changed for the better."


 

Echoing this sentiment, THAI Chief Executive Officer Chai Eamsiri emphasised the tangible progress achieved through internal reforms.

 


"Our consistent efforts in overhauling internal management have yielded demonstrable results," Chai affirmed. "Our improved efficiency and enhanced ability to generate revenue and achieve profitability are evident in our successful emergence from the rehabilitation plan and our planned return to the stock market."


 

Their cautious outlook on investor sentiment coincided with the release of robust first-quarter results for 2025. THAI and its subsidiaries reported a total revenue of 51.63 billion baht, a substantial 12.3% increase year-on-year from 45.96 billion baht.
  



 

This surge was primarily driven by sustained growth in passenger demand, coupled with fleet expansion and increased flight frequencies.

 

Passenger capacity (ASK) rose by 21.1%, and passenger traffic (RPK) increased by 20.8%, maintaining a strong average cabin factor of 83.3%. The airline carried 4.33 million passengers, an 11.6% increase from the previous year.

 

Despite the revenue surge, total operating expenses (excluding one-off items) increased by 8.8% to 37.96 billion baht, primarily due to variable costs associated with higher production and service levels.

 

This was partially offset by a 1.7% decrease in fuel expenses. Nevertheless, THAI demonstrated strong operational profitability, with EBITDA (excluding one-off items) reaching 13.66 billion baht, a significant 26.5% margin, up from 2.59 billion baht in the same period last year.

 

Financial costs, under TFRS 9, amounted to 3.48 billion baht. The airline also incurred net one-off expenses of 339 million baht, mainly from asset impairments and derivative losses, although this was partially offset by foreign exchange gains.

 

Ultimately, THAI and its subsidiaries posted a net profit of 9.84 billion baht, with EBITDA after cash lease payments at 12.73 billion baht.

 



 

Operational improvements included an expanded active fleet of 78 aircraft in Q1 2025, up by five year-on-year, with an average utilisation of 13.7 hours per day.

 

Future fleet enhancements include new A321neo aircraft equipped with in-flight entertainment and free Wi-Fi for Royal Orchid Plus members, expected by the end of 2025.

  

Customer experience was also enhanced with the introduction of high-speed internet on A330-300 aircraft, including free text and chat, and complimentary internet for ROP members based on their status.

 



 

As of March 31, 2025, THAI's total assets stood at 297.75 billion baht, a 1.8% increase from the end of 2024. The airline's liquid assets (cash, short-term investments) increased to 124.85 billion baht.

 

Total liabilities decreased by 1.9% to 242.31 billion baht, resulting in a shareholders' equity of 55.44 billion baht, a substantial 21.6% increase.

 

The debt-to-equity ratio and interest-bearing debt to equity ratio have significantly improved since before the rehabilitation in 2019, now standing at 4.37 and 2.23 respectively.

 

In a move to address past losses and pave the way for potential future dividends, shareholders approved a reduction in the par value of shares in February 2025.

 

Following the first-quarter profit, THAI's separate financial statements showed retained earnings of 9.56 billion baht.

 



 

Further restructuring saw the approval for the dissolution of THAI Smile Airways, with its Airbus A320 fleet fully integrated into THAI's operations.

 

THAI has already seen profitability improvements on routes previously operated by THAI Smile, attributed to network optimisation and cost efficiencies.

 

The final steps of the rehabilitation plan included the appointment of a new board of directors in April 2025, and the completion of the plan has been filed with the Central Bankruptcy Court, with a hearing scheduled for June 4, 2025.

(2025/05/09-00:00)