THAI execs reiterate airline on course to exit rehabilitation plan

 

Thai Airways International (THAI) executives have moved quickly to reassure stakeholders that the huge loss reported for fiscal year 2024 was solely attributable to a one-off debt-to-equity conversion, and would not impede the airline's operational performance or its planned exit from its rehabilitation programme. 

 

This clarification came after the airline released its financial performance report to the Stock Exchange of Thailand on Wednesday morning. 

 

Speaking at a press conference later in the afternoon, Piyasvasti Amranand, chairman of the rehabilitation plan administrator for Thai Airways, highlighted that the airline's total revenue, excluding exceptional items, continued to rise in 2024, reaching 187.989 billion baht—a 16.7% increase from 161.067 billion baht in 2023. 

 

The operating profit before financial costs, also excluding one-off items, grew by 3.2% to 41.515 billion baht, while the operating profit margin before financial costs (EBIT Margin) reached 22.1%, surpassing the projections set out in the rehabilitation plan.

 

However, the airline’s consolidated financial statement for 2024 reported a loss of 26.901 billion baht, primarily attributable to a one-time accounting loss of 45.271 billion baht resulting from the debt-to-equity conversion completed in November 2024. Most of this loss—approximately 40,582 million baht—occurred as creditors exercised their conversion rights at prices below fair value, as outlined in the rehabilitation plan. 

 

 

 

The remaining losses stemmed from creditors receiving accelerated debt repayments. Piyasvasti emphasised that these were one-time accounting losses unrelated to the airline's core business operations and would not hinder its exit from rehabilitation, as the company’s equity remains positive following the capital restructuring. 

By the end of 2024, the airline reported earnings before interest, taxes, depreciation, and amortization (EBITDA) of 41.473 billion baht, significantly exceeding the 20 billion baht threshold stipulated in the rehabilitation plan. 

 

Additionally, the company’s equity rebounded to a positive 45.495 billion baht, a remarkable turnaround from the negative 43.352 billion baht recorded in 2023, driven by operational profits and the capital restructuring, Piyasvasti said. 

 

This achievement not only meets another condition for the rehabilitation plan's success but also eliminates any grounds for delisting from the Stock Exchange of Thailand, thereby enabling the airline to resume trading.

 

 

Rehabilitation and new directors

The next phase of the rehabilitation plan involves an extraordinary general meeting of shareholders scheduled for April 18, with a record date of March 14. 

 

During this meeting, shareholders will deliberate on the appointment of 11 or 12 directors, which will consist of the current three directors—Piyasvasti Amranand, Chansin Treenuchagron, and Air Chief Marshal Amnat Jeeramaneemai—as well as eight or nine new directors.
 

 

Proposed new directors include Lawan Saengsanit, Kulaya Tantitemit, Chakree Bamrungwong, Pol General Thatchai Pitaneelaboot, Chatchai Rojanarattanangkul, Chai Eamsiri.

 
The three independent directors are: Napakorn Thanasuwankasem, Yanyong Dechpirattanamongkol, and Samrit Samniang. 

 

Following shareholder and Central Bankruptcy Court approval, the company will register the director changes before petitioning to terminate the rehabilitation.

 

 

Share value restructure

During the Plan Administrators’ meeting on Wednesday (February 25), a decision was made to reduce the company's share par value from 10 baht to 1.30 baht in order to address accumulated accounting losses. 

 

This reduction will decrease the registered and paid-up capital from approximately 283.033 billion baht to 36.794 billion baht, bringing accumulated losses down to 180 million baht. 

 

Executives assured that this measure would not adversely affect creditors or the company itself, nor would it impact overall equity or share value. Instead, it would facilitate future dividend payments and enhance the company’s attractiveness to investors. 

 

"We will exit the rehabilitation plan as scheduled. While we pursue profitability and growth, we remain dedicated to full debt repayment, expecting to repay approximately 10,000 million baht annually until 2036," Piyasvasti said.

 

 

THAI strategy for 2025

In outlining the airline's operational strategy for 2025, CEO Chai Eamsiri announced plans to enhance service frequencies, with the addition of nine new aircraft expected in the latter half of the year. 

 

Although no new destinations are planned, notable increases in flight frequencies will occur, particularly to India: flights to Mumbai will rise from 11 to 14 per week. Additional frequency boosts are also anticipated for routes to Germany, Pakistan, and various Western European locations. 

 

While routes to China are set for frequency increases, passenger recovery in that market has lagged behind expectations, with Chinese revenue representing only 1-2% of the airline's total income. 

 

Thai Airways is shifting its focus from point-to-point routes to network sales, aiming to diversify revenue and lessen market dependence, with a goal to elevate network sales revenue to 40% in the future.

 

THAI and its subsidiaries currently operate a fleet of 79 aircraft, comprising 59 widebodies and 20 narrowbodies. In its winter 2025 flight schedule, THAI plans to maintain flights to 64 destinations, consistent with 2024, while increasing the total number of weekly flights to 883—up by 40 from the 843 weekly flights in 2024. This expansion is aimed at meeting rising passenger demand on popular routes and supporting the ongoing growth in travel trends.