THAI AIRWAYS INTERNATIONAL PCL

Transcription

1 THAI AIRWAYS INTERNATIONAL PCL Analyst Briefing 3Q/011 1 Investor Relations Department

2 DISCLAIMER The information contained herein is intended to represent the Company s operating and financial position at a given point in time and may also contain forward looking information which only reflects expectations based on the prevailing geopolitical, economic and noncontrollable factors. Such information has been obtained from sources believed to be most reliable and the means in analyzing and preparation of such information for disclosure are based on approved practices and principles in the investment industry. The views are based on assumptions subject to various risks and uncertainties and no assurance is made as to whether such future events will occur, that projections will be achieved, or that the assumptions herein are correct. Consequently no assurance is made as to the accuracy or completeness of information presented in this document. This document should not be construed as an investment guide or as an offer or solicitation of an offer to buy or sell the Company s equity shares. Investor Relations Department

3 Financial Performance EBIT, EBITDA and Net Profit (3Q/010 & 3Q/011) Units : THB mn Factors Impact slow down in 3Q/11 Results Impact from European and US economies Fuel cost is approximately 4%, higher in 3Q/011 over 3Q/ % increase in # of PAX carried Fuel surcharge coverage less than 100% from weak demand EBIT EBITDA NET PROFIT NET PROFIT (Exclude FX) FX gain THB,99 mn. 3 Investor Relations Department

4 Operating / Total Revenue (3Q/010 & 3Q/011) Financial Performance Operating Revenue Total Revenue Units : MTHB *Operating Rev. up 10.74% , , % to Revenue % Change Tot. Rev. Passenger Freight Mail ,07 Other activities Interest income Q3'10 Q3'11 Passenger Freight Mail Other activities Interest income Other income Other income Total Income *Excludes Interest & Other income Operating revenue 3Q/10 = 44,433 MTHB Operating revenue 3Q/11 = 49,04 MTHB Total revenue 3Q/10 = 45,414 MTHB Total revenue 3Q/11 = 49,961 MTHB 4 Investor Relations Department

5 50,000 40,000 30,000 0,000 10,000 Operating / Total Expense (3Q/010 & 3Q/011) Units : MTHB 1,40 4,993,05 1,189,38 4,505 13,941 Operating Expense **Operating Exp. Up 16.4% 1,37 5,113 3,043 1,373,751 5,137 0,013 Financial Performance Total Expense % Change % of Expense YoY Tot. Exp. Personnel expense Fuel and oil Flight service expense Inventories and supplies Crew expense Maintenance/overhual ,19 6,470 Q3'10 Q3'11 Personnel Fuel and Oil Flight Service Expense Inventory&Supply Crew Expense Aircraft Maintenance Depreciation Lease of a/c ** Excludes FX & Impairment losses Operating expense 3Q/10 = 41,019 MTHB Operating expense 3Q/11 = 47,755 MTHB Depreciation/amortisation Aircraft lease/spare parts Other expense Total Expense Total expense 3Q/10 = 44,38MTHB Total expense 3Q/11 = 45,90MTHB 5 Investor Relations Department

6 Financial Performance Ratios 3Q/010 & 3Q/011 Ratios units 3Q/10 3Q/11 Earnings Per Share (THB) EBIT (MTHB) 3, EBITDA (MTHB) 8, ,48.0 EBITDAR (MTHB) 9, ,719.0 Operating Profit Margin (%) Net Profit Margin (%) EBITDA Margin (%) Interest Bearing Debt to Equity (Times) Net Interest Bearing Debt to Equity (Times) 1.4* 1.7* Interest Coverage (Times) * Total loan Cash and Cash Equivalent / Equity 6 Investor Relations Department

7 Operating Summary Units 3Q/11 3Q/10 % Change Passenger Production MASK 19,837 18, Passenger Traffic MRPK 14,681 14, Cabin Factor % Passenger Yield THB/km Freight Production MADTK 1,4 1, Freight Traffic MRFTK Freight Factor % Freight Yield THB/km Avg. Fuel Cost USD/gallon (E) Note : Yield includes fuel surcharge 7 Investor Relations Department

8 Financial Performance EBIT, EBITDA and Net Profit (9M/10 & 9M/11) Units : THB mn Factors Impacting 9M/11 Results Impact from Middle east unrest, Japan Earthquake & European economic weakness Fuel cost is approximately 41% higher YoY 4.% increase in # of PAX carried EBIT EBITDA NET PROFIT NET PROFIT (Exclude FX) Fuel surcharge coverage less than 100% from weak demand FX loss THB 3,35 mn. 8 Investor Relations Department

9 Operating / Total Revenue (9M/010 & 9M/011) Financial Performance Units : MTHB 160, , , ,000 10, , ,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 0,000 10, ,590,641 0, ,898 9M'10 Operating Revenue *Operating Rev. up 9.81% 611 1,978 0, ,69 9M' ,9 Passenger Freight Mail Other activities Interest income Other income 65 Total Revenue % to Revenue % Change Tot. Rev. Passenger Freight Mail Other activities Interest income Other income Total Income *Excludes Interest & Other income Operating revenue 9M/10 = 13,106 MTHB Operating revenue 9M/11 = 145,069 MTHB Total revenue 9M/10 = 134,854 MTHB Total revenue 9M/11 = 147,371 MTHB 9 Investor Relations Department

10 160, , , ,000 10, , ,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 0,000 10,000 0 Operating / Total Expense (9M/010 & 9M/011) Units : MTHB 15,36 6,835 3,774 6,77 14,013 4,033,748 4,148 14,916 8,63 4,083 7,119 15,333 56,894,459,898 9M'10 9M'11 Personnel Fuel and Oil Flight Service Expense Inventory&Supply Crew Expense Aircraft Maintenance Depreciation Operating Expense **Operating Exp. Up 15.04% Lease of a/c ** Excludes FX & Impairment losses Operating expense 9M/10 = 15,004 MTHB Operating expense 9M/11 = 143,81MTHB Financial Performance Total Expense % Change % of Expense YoY Tot. Exp. Personnel expense Fuel and oil Flight service expense Inventories and supplies Crew expense Maintenance/overhual Depreciation/amortisation Aircraft lease/spare parts Other expense Total Expense Total expense 9M/10 = 118,53 MTHB Total expense 9M/11 = 148,195 MTHB 10 Investor Relations Department

11 Financial Performance Ratios 9M/010 & 9M/011 Ratios units 9M/10 9M/11 Earnings Per Share (THB) EBIT (MTHB) 7, EBITDA (MTHB),658 15,57 EBITDAR (MTHB) 5,406 19,404 Operating Profit Margin (%) Net Profit Margin (%) EBITDA Margin (%) Interest Bearing Debt to Equity (Times) Net Interest Bearing Debt to Equity (Times) 1.4* 1.7* Interest Coverage (Times) * Total loan Cash and Cash Equivalent / Equity 11 Investor Relations Department

12 Operating Summary Units 9M/11 9M/10 % Change Passenger Production MASK 58,580 55, Passenger Traffic MRPK 4,99 41, Cabin Factor % Passenger Yield THB/km Freight Production MADTK 4,1 3, Freight Traffic MRFTK,334,380.0 Freight Factor % Freight Yield THB/km Avg. Fuel Cost USD/gallon (E) Note : Yield includes fuel surcharge 1 Investor Relations Department

13 Improved Capital Structure Cash to Total Revenue Improved Cash Position Raised 15,000 MTHB in in new new equity Received additional borrowing from financial institutions Obtained Revolving Credit Lines 5 Stable Capital Structure Net Interest Bearing Debt to Equity (Times) 8,000 MTHB Debenture issued in in May May 13, 13, Q1/11 Q/11 Q3/11 13 Investor Relations Department

14 011 Route Network Changes Increase direct flights from BKK to secondary market and increasing over all connectivity but will adjust capacity to reflect demand Winter Program Suspension routes New Flights Opening BKKBrussel v.v. BKKBelgium v.v. (As from 17NOV11) 3 Flights / Week 3 Flights / Week Route Adjustment BKKPhuketPerth v.v. BKKTokyoPhuket BKKChiang MaiPhuketBKK Additional Frequency BKKOslo v.v. Effective Oct. 30, 011 Mar. 4, 01 HKTPerth v.v. BKKNarita v.v. BKKChiang MaiPhuket v.v. 5 to 7 Flights / Week BKKCopenhagenPhuket (As from 11NOV11) BKKOsaka v.v. (As from 16NOV11) HKTSeoul v.v. BKKSingapore v.v. Flight Resumption BKKBeijing v.v. BKKKathmandu v.v. 3 Flights / Week 3 Flights / Week 3 Flights / Week 7 Flights / Week 4 Flights / Week 3 Flights / Week BKKPerth v.v. BKKXiamen v.v. BKKChengdu v.v. BKKNagoya v.v. (As from 01JAN1) BKKMumbai v.v. BKKGayaVaranasi v.v. (30OCT 31DEC11) 4 to 7 Flights / Week 3 to 4 Flights / Week 4 to 5 Flights / Week 10 to 11 Flights / Week 6 to 13 Flights / Week 4 to 7 Flights / Week BKKHat Yai v.v. 7 Flights / Week Effective Oct. 30, Investor Relations Department

15 Revenue By Class By Area Total revenue = 115,385,775 MTHB 15 Investor Relations Department

16 # of PAX By Class By Area Total passengers in 011 = 13.9 mn. Total passengers in 010 = 13.3 mn. 16 Investor Relations Department

17 Rising Fuel Cost 17 Investor Relations Department

18 Fuel Management Hedging combined with fuel surcharge greatly mitigates fuel price fluctuation risk Monthly fuel hedging % of consumption by month Percentage of Fuel Surcharge & Hedging Coverage Jan08 Feb08 Mar08 Apr08 May08 Jun08 Jul08 Aug08 Sep08 Oct08 Nov08 Dec08 Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10 Feb10 Mar10 Aprl10 May10 Jun10 Jul10 Aug10 Sep10 Oct10 Nov10 Dec10 Jan11 Feb11 Mar11 Apr11 May11 Jun11 July11 Aug11 Sep11 Oct11 57% 65% 6% 56% 51% 51% 61% 65% 69% 7% 7% 63% 8% 74% 13% 131% 116% 10% 91% 78% 118% 11% 10% 110% 104% 98% 94% 116% 106% 111% 103% 109% 101% 10% 98% 87% 88% 77% 95% 95% 97% 9% 94% 163% 143% 199% Jan08 Feb08 Mar08 Apr08 May08 Jun08 Jul08 Aug08 Sep08 Oct08 Nov08 Dec08 Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10 Feb10 Mar10 Apr10 May10 Jun10 Jul10 Aug10 Sep10 Oct10 Nov10 Dec10 Jan11 Feb11 Mar11 Apr11 May11 Jun11 Jul11 Aug11 Sep11 Oct11 Nov11 Dec11 Jan1 Feb1 Mar1 Apr1 May1 Jun1 Jul1 Aug1 Sep1 Oct1 Nov1 Dec1 0% 0% 0% 0% 3% 17% 38% 41% 44% 44% 49% 35% 7% 0% 3% 3% 3% 7% 13% 13% 17% 0% 7% 30% 44% 44% 44% 47% 47% 47% 33% 33% 33% 3% 3% 3% 51% 51% 51% 50% 50% 56% 69% 69% 69% 69% 69% 69% 59% 59% 59% 56% 56% 56% 80% 80% 80% 80% 80% 80% 18 Investor Relations Department

19 Strategy to close THAI s business gap THAI Smile to complement THAI s product offering Brand positioning matrix for THAI and affiliated companies Product Offering Premium full service Premium 3 class Premium class Premium regional (wide body) Class Class Launch July 01 No frills THAI LCC Stage length small* big connecting Regional Intercontinental Domestic Note: * NOK focuses on DMK only; ** Possibilities surrounding expanding fleet to include widebody aircraft will be evaluated as opportunities arise 19 Investor Relations Department

20 THAI s Portfolio Product by Cost Base Brand Brand positioning Cost base Premium network carrier MEDIUM to HIGH Minor improvements could be made in cost efficiency Regional carrier LOW to MEDIUM Low cost base achieved through aspects of LCC model, such as single aircraft type, new fleet, etc. Domestic valueformoney carrier LOW to MEDIUM Domestic focus with some added value and maintaining very low cost 0 Investor Relations Department

21 THAI Smile s Strategies THAI Smile s first flight will commence on July 1st, 01 after receiving first brand new aircraft in June 01 Brand new narrow body aircraft # of aircraft Positioning Differentiation Character Value Affordable Light Premium Good Price High Value BRAND Trendy Friendly Worthy Reliable Enjoyable Valuable Fleet Plan (01F18F) Investor Relations Department

22 Statistic on Internet Checkin Ticket Sales Via Internet Checkin via Internet % Year 011 Year % Year 011 Year Year Year Jan Feb Mar Apr May 0 Jun Jul Aug Sep Oct Nov DEC 1 Jan Feb Mar Apr May 0 Jun Jul Aug Sep Oct Nov Dec Investor Relations Department

23 Statistic on use of EServices # of PAX Checkin via Mobile ( 3,500 3,000 3,310 3,088,500,309,31,368,000 1,813 1,500 1,136 1,300 1, Jul10 Aug10 Sep10 Oct10 Nov10 Dec10 Jan11 Feb11 Mar11 Apr11 May11 Jun11 Jul11 Aug11 3 Investor Relations Department

24 Current Fleet Current Fleet: 89 Aircraft 51% of O 9% of OL 40% of FL O=Owned OL=Operating lease FL=Financial lease (Note: Approximately) Aircraft Type A Exc. of ATR7 4 of leased to Nok First Business Premium Economy Economy Total 36R1 6 N.A. 46 N.A N.A. 8 N.A A N.A O, 3 FL A N.A FL A N.A. 4 N.A N.A. 36 N.A B N.A. 1 N.A FL, 3 OL B N.A N.A B N.A. 30 N.A O, OL B77700ER 77E1 6 N.A. 30 N.A FL B Version # of Aircraft # of Seat N.A. 34 N.A TKE 1 N.A. 34 N.A Financial Method B777300ER N.A OL Total ,58 4,14 39 O, 38 FL, 1 OL 11 O 10 O, 10 FL, OL 11 O, 5 FL 6 FL (Note: N.A.. = Not available) 4 Investor Relations Department

25 Aircraft Utilization Aircraft Utilization Hours / Day / Aircraft Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Investor Relations Department

26 Aircraft Delivery Plan NEW A/C DELIVERY TOTAL A (FL) 3 (FL) 6 B777300ER (OL) 6 (OL) 3 (FL) 3 (FL) 14 B777300ER (Jet Airways) 1+1 (OL) A (FL) 3 (FL) (FL) 1 A (FL) + (OL) (FL) + 6 (OL) 1 B7879 (OL) B (OL) (OL) 6 A30 4 (OL) (OL) (FL) 3 (FL) 11 TOTAL Note : OL = Operating lease FL = Financial lease 6 Investor Relations Department

27 Phase Out Plan PHASEOUT PLAN TOTAL B * 6 B777300ER (Jet Airways) 5 5 A A B77700 A A B ** 1** 3 9 ATR7 TOTAL Note : * To be converted to cargo planes ** Return from Nok Air 7 Investor Relations Department

28 Fleet Strategy Through TOTAL # of Aircraft Total Seats in operation 6,691 8,49 9,570 30,97 31,581 3,391 33,660 Seat Growth 5.8% 5.8% 3.8% 8.7%.0%.6% 3.9% 4.7% Age Fleet Age Investor Relations Department

29 Upgrades and Retrofit Schedule # of Aircraft First Business Economy Tentative Completion B No Retrofitted Retrofitted Jun. Dec. 011* (Four have been completed) B No Apr.Oct. 01 B77700 No. 1 1 Retrofitted Dec. 011 * B77700 No. 8 7 Retrofitted Mar. Dec. 01* * Note: Completion of retrofit has been postponed due to Donmuang but will likely be completed by 01 9 Investor Relations Department

30 New Aircraft A330 & A380 New Airbus A Royal First class New Airbus A Royal Silk Class Royal Silk Class Economy Class Economy Class 30 Investor Relations Department

31 Price Volatility from External Events Share price peaked at THB upon being inducted back into the MSCI* Cash flow crisis Drafted & Implemented strategies under TG 100 Success recapitalization Pressure from high fuel cost Implemented recovery plan Fuel price Dec Apr. 11 European economic crisis * MSCI = Morgan Stanley Capital International 31 Investor Relations Department