THAI holds its Annual General Shareholders’ Meeting 2017
Air Force Convention Hall – Mr. Areepong Bhoocha-oom, Chairman of the Board of Directors, Thai Airways International Public Company Limited (THAI), presided over the Company’s Annual General Shareholders’ Meeting 2017, with the attendance of THAI’s Board of Directors, THAI Management and shareholders, covering the following agenda:
Operating Results for 2016
At THAI’s Annual General Shareholders’ Meeting 2017, the operating results for 2016 (January-December 2016) were acknowledged. THAI continued to implement its second phase of the transformation plan “Strength Building” in 2016 by embarking on four main strategies: 1.) generating aggressive revenue, 2.) reducing cost and increasing efficiencies, 3.) building capabilities for sustainable growth, and 4.) creating excellent quality of service. THAI implemented these tasks by using information technology with international standards to enhance revenue management and to implement its new business class service, to launch new routes: Bangkok-Tehran, Iran, Phuket-Frankfurt, to resume the Bangkok-Moscow route, to add flight frequencies in Europe, and continuation of last year’s MSP program.
Furthermore, THAI adjusted its fleet strategy by taking delivery of 2 Airbus A350-900XWB aircraft that primarily operate on intercontinental routes while it decommissioned 2 Boeing 777-200 operating lease aircraft on 31 December 2016 with 95 aircraft remaining in the fleet, which is the same amount as the end of the previous year but with improved aircraft utilization. Consequently, product traffic (ASK) of THAI and its subsidiaries increased by 1.9% while passenger traffic (RPK) increased by 2.5%. The average cabin factor was 73.4% higher than last year which was 72.9% with 22.3 million passengers carried, representing a 4.8% increase from last year.
As a result of development in various areas based on the strategic plan and satisfactory success of the organization’s transformation, there was an overall improvement in customer satisfaction evident from various awards that the Company received. In addition, the financial performance in 2016 of THAI and its subsidiaries showed an operating profit of THB 4,071 million compared to last year’s loss of THB 1,304 million or 412.2%, a vast improvement from last year mainly because total expense decreased by 7.1% from the decrease in fuel expense by THB 17,907 million (28.3%) resulting from the jet fuel prices that dropped by 21.6% and improved fuel risk management, net finance cost reduced by THB 431 million (7.7%) due to efficient cash management and financial restructure, while non-fuel operating expense increased by THB 4,773 million (3.9%) mostly due to increase in maintenance and overhaul expenses. Total revenue decreased by THB 8,190 million (4.3%). Passenger and excess baggage revenue reduced by THB 4,428 million (2.9%) due to fuel surcharge adjustment while other revenue reduced by THB 3,775 million since last year, the main reason being that last year THAI received insurance compensation from the delayed delivery of economy class seats at the amount of THB 3,968 million.
In 2016, THAI and its subsidiaries had a one-time cost item that resulted from aircraft maintenance based on actual conditions of aircraft and maintenance contractual obligations of THB 1,317 million, transformation plan expenses of THB 1,228 million, and impairment loss of assets and aircraft of THB 3,628 million but had a THB 685 million gain on foreign currency exchange. Consequently, THAI and its subsidiaries reported a net profit of THB 47 million. Profit attributable to owners of the parent amounted to THB 15 million. Profit per share was THB 0.01 or 100.2% higher than last year’s loss per share of THB 5.99.
As of 31 December 2016, total assets were THB 283,124 million, a decrease of THB 19,347 million (6.4%) from 31 December 2015, mainly due to short-term and long-term repayment, additional provision of impairment of aircraft and aircraft sold during the year. Total liabilities as of 31 December 2016 totaled THB 249,536 million, a decrease of THB 20,009 million (7.4%) from 31 December 2015. Total shareholders’ equity amounted to THB 33,588 million, an increase of THB 662 million (2.0%).
Distribution of Dividend
At the Annual General Shareholders’ Meeting, shareholders approved to suspend payment of dividend in reflection of the Company’s financial performance in 2015. The suspension of dividend payment is in accordance with the Company’s dividend policy providing that the Company shall distribute “not less than 25 percent of the consolidated net profit before gains or losses on foreign currency exchange and shall also be subject to the future investment plans, necessity and appropriateness.”
Selection of Board of Directors
At the Annual General Shareholders’ Meeting 2017, the following Directors retired by rotation:
1. ACM Treetod Sonjance
2. Gen. Chatudom Titthasiri
3. ACM Siwakiat Jayema
4. Mr. Peraphon Thawornsupacharoen
5. Mr. Somchai Sujjapongse
At the Annual General Shareholders’ Meeting, the following three Directors were appointed for another term:
1. ACM Treetod Sonjance
2. Mr. Peraphon Thawornsupacharoen
3. Mr. Somchai Sujjapongse
At the Annual General Shareholders’ Meeting, the following Directors were appointed to replace those who retired by rotation:
1. ACM Johm Rungswang, in place of ACM Siwakiat Jayema
2. Mr. Vachara Tuntariyanond, in place of Gen. Chatudom Titthasiri
Attending THAI’s Annual General Shareholders Meeting were 1,434 shareholders, representing 1,625,253,727 shares.