THAI to tackle business structure next year

The plan, which will include the business direction for 2014 and 2015, will be proposed to the company’s board of directors next month. Under the plan, the company’s organisational structure will be revamped with the objective to increase revenues and reduce expenditures. However, any changes under the plan are to have no effect on the safety or the quality of the airline’s service.
The national carrier believes the current political rallies could adversely affect fourth-quarter operations despite the final quarter of the year being the peak tourism season, especially after 16 foreign countries have issued travel advisories to warn their citizens about possible risk to their safety should the conflicts escalate.
THAI president Sorajak Kasemsuvan said after yesterday’s board meeting that the company had made a second revision of its anticipated net profit for this year to about Bt2 billion. The first revision lowered the forecast from Bt6 billion to about Bt4 billion.
THAI posted Bt6.2 billion in net profit last year.
He said the lower projected profit was the result of the increase in passengers, and consequent revenue contribution, failing to be in line with the surge in the number of seats from this year’s purchase of 17 new aircraft. The airline was also hit by higher operational costs, together withh foreign-exchange losses.
“We are able to identify that this year’s performance will see lower profit [than previously projected]. We acknowledge that we have been affected by many risk factors that are outside our control.
“Our internal routes have been affected by the political demonstrations, which caused the number of domestic passengers to drop by 2-3 per cent [so far] in November.
“For the overseas routes, we have been affected by the zero-dollar tour scam, which will see a short-term effect with Chinese tourist arrivals probably declining. The Indian market is now facing internal economic problems, which will result in their outbound travel declining significantly. The European market is seeing a slight decline in ticket bookings during this travel season. Meanwhile, the Japanese market is growing significantly,” Sorajak said.