Nok performance hits record earnings

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Nok performance hits record earnings  
Bangkok Post: 2 Feb 2011
 
AVIATION
Nok performance hits record
But slower growth expected in 2011

Nok Air finished 2010 with record earnings and revenue and envisages continued growth this year despite negative factors such as slower economic expansion and rising fuel costs.

The budget airline posted an 83.9% jump in its net profit last year to 618 million baht from 336 million in 2009, as Thailand's robust economic growth drove travel demand.

Passenger revenue surged by 37% to 3.97 billion baht, while passenger numbers increased by 43.5% to 3.1 million, final figures recently reported to the airline's board showed.

The results were the best since the airline began operations in July 2004 and reflect a further improvement in its balance sheet.

Nok Air has been gradually recovering from a financial crisis ever since launching a dramatic rationalisation in mid-2008 to contain losses stemming from a spiking oil price, global economic turbulence and overexpansion including the launch of international service to Vietnam and India.

But the airline expects a lower profit this year due to rises in crude oil prices and slower GDP growth expected to be roughly half of last year's 7.9%.

"We would rather be conservative in our projection than too optimistic," said chief executive Patee Sarasin.

The airline got off to a good start in 2011 with a January net profit of 60 million baht. "That bodes well for profitability during all of 2011," he said.

However, the airline, 39% owned by Thai Airways International, expects other figures will continue to improve. Passenger revenue is expected to rise to 5.4 billion baht, with volume setting a record of 3.8 million.

The 2011 projections are based on operation of 10 Boeing 737-400s and two ATR-72 turboprops and an expanded network cover 20 destinations nationwide.

Mr Patee said discussions were under way to lease seven Boeing 737-800s and four more ATR-72 turboprops following board approval last November.

The airline plans to include the newer, more advanced and more capable 737 jets in its fleet in stages starting next year as part of a conversion programme to phase out "classic" 737-400s, some leased from THAI.

Nok Air will obtain delivery of two ATR-72s in September and another two next year aimed at supporting its plan to fly to more small domestic cities.

http://www.bangkokpost.com/business/aviation/219438/nok-performance-hits-record