Wednesday, June 3, 2009

Thailand's aviation fuel provider forecasts sales will dive deeper


Published: 2/06/2009 at 12:00 AM
Newspaper section: Business

Bangkok Aviation Fuel Services Plc (Bafs), the country's largest jet refuelling provider, is braced for a larger-than-expected 5% drop in its revenue this year due to political conflict and the H1N1 flu outbreak.

Bafs sold 333 million litres of fuel in May - a 10% year-on-year drop - while the company had earlier forecast a 7% year-on-year contraction, said managing director M.R. Supadis Diskul.

Annualised volume tumbled 10.6% in April, against an anticipated fall of 9%, after red-shirted supporters of the United Front for Democracy against Dictatorship (UDD) rioted over the Songkran holidays.

"Normally, there are a number of charter flights arriving in Thailand during the Songkran holidays in addition to scheduled flights. But this year they almost vanished because of the chaos," M.R. Supadis said yesterday.

"The latest figures have prompted us to project overall volume dropping by 6% this year, larger than the previous forecast of 2%. This would result in a decrease of 5% in revenue."

Meanwhile, H1N1 influenza, which has been fatal in 99 out of 15,510 confirmed cases, has triggered a plunge in flights from Japan and China, he said.

With falling passenger numbers, airlines have switched to smaller planes to cut fuel costs, he said.

Financially constrained Thai Airways International Plc (THAI), Bafs' largest customer, provided 39% of the company's into-plane volume in the first quarter.

Passenger traffic at Suvarnabhumi and Don Mueang airports fell 17.6% year-on-year to 10.8 million in the first three months, as flights slid 15% to 34,923 by the end of March.

"Not only the Bangkok hubs, but regional airports in Hong Kong and Singapore have also declined because of the global recession. But the drop is larger in Thailand," said M.R. Supadis.

Sales volume at Hong Kong and Singapore international airports fell 6.1% and 4%, respectively, in the first four months of this year. Meanwhile, Suvarnabhumi and Don Mueang saw a 13.8% decline, he said.

Bafs posted a 13.5% year-on-year decrease in revenue to 510.5 million baht in the first thee months of the year. Aviation fuel service income dropped 12.3% to 503 million baht. Net profit plummeted 23.3% year-on-year to 108 million baht.

But the company projects its volume will return to growth in the third quarter based on a timetable of airlines' scheduled flights, said M.R. Supadis. THAI, for example, is set to get six new planes to expand its services this year.

Shares of BAFS closed yesterday on the Stock Exchange of Thailand at 6.45 baht, up 20 satang, in trade worth 3.89 million baht.

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