Today, Thai Airways International Public Company Limited (THAI) announced its Q2 results, which saw a 570% year-on-year increase in passenger numbers.

COVID-19 Recovery

Loosening COVID travel restrictions has played a large part in the rebound of air travel. Some regions of the world were hit harder than others in terms of flight restrictions and flight cancellations, and Thai was heavily impacted. Because of the loosening restrictions around the world, in Q2, Thai and its subsidiaries' Revenue Passenger Kilometers (RPK) saw a 1,766.9% increase over last year. Available Seat Kilometers (ASK) rose 366.6%, load factors averaging 60.3%, 15% higher than last year. The total number of passengers rose by 570%, totaling 2.01 million during Q2.

thai-airways-a380-1
Thai had a small fleet of A380s but these were retired due to the pandemic. Photo: Thai Airways

As passenger demand increased in July of this year, so did the demand for cargo. During the month of July, load factors rose to 77.7%, which led to passenger and cargo revenue totaling about 10,000 million baht ($282 million). Almost one-third of all passengers traveled to and from Thailand, and Thai and its subsidiaries had cash equivalents of around 13,474 million baht ($381 million) at the end of June, compared to about 5,515 million baht ($156 million) at the end of 2021.

In-depth look at THAI's finances

In an industry that is rapidly recovering from the COVID-19 pandemic, Thai saw a significant increase in its revenue from both passenger and cargo services. During the second quarter of 2022, Thai and its subsidiaries had a total revenue (excluding one-time transactions) of about 21,526 million baht ($608 million), a 282% increase over last year. Revenue from cargo and passenger services increased by a whopping 619.3% at about 19,803 million baht ($559 million). The largest increase came from cargo services and not passengers, as production continues to rise and the necessity for shipping increases.

For the first time since Thai has operated under the Rehabilitation plan, its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) was positive. In Q2, after the deduction of aircraft lease, the profit from EBITDA was about $4.78 million (168 million baht), while last year saw a loss from EBITDA of about 9,212 million baht ($260.4 million).

Thai Airways Taking off
Photo: Getty Images

Thai's expenses also increased, mainly due to the increase in cost of aviation fuel worldwide. Excluding one-time transactions, Thai's expenses totaled about 22,825 million baht ($645 million), an increase of 126.3% over the previous year. The cost of aviation fuel increased by 104.1%, amounting to 39.2% of its total operating expenses.

Thai implemented a Rehabilitation Plan, meant to evaluate the airline's operations and streamline them. Through this program, the company has been able to reduce personnel expenses, significantly lowering operating loss before financial costs (excluding one-time transactions). Last year's operating loss was about 4,449 million baht ($125.8 million), compared to about 1,299 million baht ($36.7 million) baht this year.

During Q2, Thai, along with its subsidiaries, reported a financial cost of about 3,102 million baht ($87.7 million) and its one-time transactions with net profits totaled about 1,982 million baht ($56 million). These profits came from changes made in the structure of compensation, debt, and organization and the sales of assets and investments.