Thai Airways announced a return to profit in the Q1 of 2023 with increased tourism and transit demand, with passenger numbers more than three times higher than in the first quarter of 2022. In the first quarter of 2023, Thai Airways International Public Company Limited (THAI), which includes Thai Smile Airways, reported an operating expense of $840 million, leaving the group with an operating profit before finance costs of $384 million.
The airline performance was boosted by gains from the carriers restructuring program and the sale of assets, including one Boeing 747, leading to a net profit of $369 million, compared to a loss of $95.6 million in 1Q2022.
The Group carried 3.5 million passengers earning a total revenue of $1.224 billion almost four times of Q1 of 2022 when the group carried 1.02 million passengers. The Q1 passenger load factor was 83.5%, significantly improving the 1Q 2022 load factor of 32.5%.
“The increase in demand was due to the winter operating schedule that supported up to 34 destinations, including Europe, Australia and Asia,” airline said. THAI also added more capacity in 1Q on its most popular routes to Japan and South Korea and gained substantial benefit from the reopening of China borders.
At the end of the Q1 of 2023, THAI was operating 65 of its fleet of 86 aircraft, which includes 20 Airbus A320-200s operated by Thai Smile. The airline said twenty-one aircraft are in long-term parking, with another 16 removed from the fleet and up for sale.
THAI said it is proceeding with its feasibility study on restructuring THAI and its subsidiaries, including the performance of Thai Smile. Its focus is on improving the efficiency of fleet utilization and enhancing revenue opportunities from the network with more flights, especially on international routes where it faces less competition.
The group also wants to diminish the constraint of short-term aircraft procurement resulting from the continued recovery in aviation business while aircraft manufacturer has limitation in expanding production capacity to meet the rapid increase in traffic demand.