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Nok Air Loses 3.3 Billion Baht in 2016
2nd Mar 2017
For the Thailand-based low-cost carrier Nok Air, 2016 wasn’t a good year. In fact, the budget airline posted a net loss of 3.3 billion baht for last year, making it the only SET-listed airline to be in the “red” for 2016.
That 2016 was generally a bad year for Nok Air shows the fact that its 2016 loss was 98% greater than in 2015, which was also a record losing year with 1.66 billion baht. The 3.28 billion baht loss was higher than predicted, mostly because of a marginal drop in revenue and an increase in operating expenses.
As a result of aircraft maintenance costs, lease rentals and maintenance expenses for engines, Nok Air’s operating costs in 2016 increased 14.1% to 15.7 billion baht. At the same time, according to Nok Air Chief Financial Officer Brian Jeffery, the LCCs combined revenue for 2016 dropped by 1.99% year-on-year to 13.1 billion baht. This was, Mr. Jeffery said, the result of lower average fares and operating less domestic flights due to a highly competitive market.
Cost per available seat-kilometers was up by 12.1% compared to 2015 and was 2.51 baht. At the same time revenue per available seat-km dropped from 2.24 baht in 2015 to 2.02 baht last year. This resulted in a passenger yield decrease from 2.30 baht for 2015 to 2.18 baht per passenger per km in 2016.
Nok Air’s 3.28 billion loss includes a 2.8 billion baht loss from its own operations, but also 473 million baht loss from its affiliate low-cost mid-range to long-haul airline Nok Scoot.
Finally, the LCC also carried fewer passengers in 2016 (8.56 million) than in 2015 (8.76 million).
Meanwhile, Bangkok Airways, Thai Airways International (THAI) and Asia Aviation (AAV) all posted profits in 2016.
THAI, for instance, reported a 15 million baht net profit, while the year before, the flag carrier posted a 13 billion baht loss. Bangkok Airways meanwhile recorded a 1.83 billion baht profit and Thai AirAsia shareholder Asia Aviation reported a net profit for 2016 of 1.86 billion baht. In 2015, Bangkok Air had a 1.84 billion baht profit and TAA’s profit was around 791 million.
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