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AAV Announces Operational Results for 4th Quarter and Full Year 2020

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Asia Aviation Plc. (AAV), major shareholder of Thai AirAsia Co., Ltd. (“TAA”), has reported its operational results for the 4th quarter of 2020, showing clear signs of recovery across many key metrics.

In particular this was contributed to by the heightened domestic travel demand during the year-end holiday season and supported by various state tourism promotional campaigns.

Domestic flight services performed exceptionally well in 4Q2020 with TAA operating 107 percent of the number of seats it did in the corresponding period in 2019, prior to the COVID-19 outbreak. During the quarter, TAA achieved a load factor of 74 percent, carrying  2.81 million guests which was 51 percent higher than in the preceding quarter.

Despite the impact from the second wave of COVID-19 in mid-December, AAV finished 4Q2020 with a total revenue of Baht 4,158.6 million and a net loss of Baht 1,114.4 million. The loss was partially caused by the impairment on right-of-use assets equating to Baht 1,416 million. TAA was EBITDA positive in the quarter, excluding the fuel hedging loss of Baht 799 million.

Santisuk Klongchaiya, Chief Executive Officer of Asia Aviation Plc. and Thai AirAsia Co. Ltd. (TAA) said: “The 4th Quarter of 2020 revealed strong signs of recovery for the tourism and travel industries, in particular as TAA was able to return 70 percent of its fleet to service and saw an uptrend in its load factor with almost 80 percent in November, before of the next wave of the Covid-19 pandemic in December, in Thailand.

“The achievements in 4Q2020 affirm that once the situation improves, TAA will be ready to seize the huge opportunity with the public eager to travel again as soon as the situation improves especially with the rollout of vaccination programmes in Thailand and the region.

“TAA has also been aligning with the Group to develop new business avenues such as food and beverage delivery, cargo business and enhancing the airasia super app into more than just an airline, transforming it into a one stop digital travel and lifestyle super app, with numerous new  products and services,” Mr. Santisuk said.

Overall in 2020, TAA served 9.49 million passengers with a full year load factor of 75 percent as targeted. AAV posted a total revenue of Baht 16,237.3 million, with a net loss of Baht 4,764.1 million, due to Covid-19 which caused  the temporary flight suspension in April.

Regardless, the airline consistently assessed the situation and optimised the flying schedule according to ongoing changes in external circumstances, while maintaining strict cash flow containment and driving operational returns.

Importantly, during the COVID-19 pandemic,TAA has continued to develop and expand its customer base, grow in line with increased demand and added a flight base at Suvarnabhumi Airport alongside Don Mueang Airport, to become the only carrier to operate flights out of both Bangkok airports. As part of numerous cost containment measures, TAA has undertaken a staff reduction exercise by rightsizing the workforce including allowing staff to go on unpaid leave or furlough schemes. The airline has also reviewed its airport operational costs including discounts on landing and parking charges as well as air navigation fees. The strict focus on reducing cash flow and cost containment measures will continue to provide benefits well into 2021.

“We are confident that in 2021, once the COVID-19 situation alleviates and vaccination programmes are widespread, the tourism and aviation industries will bounce back and that international flights will gradually resume by the year-end. TAA is ready to boost travel and tourism, and stimulate the economy while maintaining its stringent health and hygiene measures.  We are confident of maintaining our market share while expanding in the logistics sector, in particular, our cargo services, in support of the transport of vaccines domestically and regionally. We are in the midst of fundraising to improve the company’s liquidity position  including exploring a soft loan, debt, or issuing new shares.” Mr. Santisuk remarked.