Fuel takes toll on Thai profits

According Dow Jones Newswires, he did not disclose the internal projection.

A larger fuel bill would also result in the carrier's 2008 net profit being lower than last year, Apinan told reporters. The company made a net profit of Bt6.34 billion last year.

From January to March, THAI's net profit plunged 48 per cent year on year because of higher jet-fuel costs and foreign-exchange losses. In the quarter, net profit was only Bt2.22 billion, down from Bt4.23 billion the same period a year before, as a result of a 45.4-per-cent jump in fuel expenses to Bt19.56 billion from Bt14.02 billion.

Depreciation costs also rose due to the lower estimated useful life of new aircraft and engine types. The profit plunged despite an increase in cabin factor, which was 81.6 per cent compared to 80.4 per cent in the same period last year. The average load factor increased to 72 per cent from 70.3 per cent last year.

Apinan also said THAI had agreed to spend US$500 million (Bt16.24 billion) for Rolls-Royce engines for its six Airbus A380 aircraft which are on order.

Despite the lower profits, the company's share price rose Bt0.75 or 2.86 per cent yesterday, to close at Bt27.