THAI seeks business adviser

       Thai Airways International is naming an adviser this month to help it revise its business strategies following historic losses last year that prompted the company to borrow Bt28 billion this year to ease its liquidity problem.

       Chairman Ampon Kittiampon said yesterday after the board of directors' meeting that the board approved the Bt80-million budget for the adviser, which would cover the consulting fee. The rest of it would be used to set up an asset management company to oversee THAI's buildings and aircraft leasing.
       "The board will review the entire strategies once the new president commences his term. With inputs from the internal strategy department and the consultant, the action plans should be completed in six months," Ampon said. "The adviser will give its views on the corporate structure, the financial structure, investment plans and strategies on passengers."
       Newly appointed president Piyasvasti Amranand will start his work in November.
       According to Ampon, the company expects a more financially stable condition next year as short-term debts have been transformed to medium-term debts. Meanwhile, the risk-management committee is also instructed to closely monitor global oil prices, so that the airline can adjust fuel surcharges promptly.
       The THAI board yesterday also approved Bt10 billion in borrowing to boost the airline's liquidity, after acknowledging the management's financial restructuring plan, said Ampon. Two financial institutions have shown interest in providing the term loan, he added.
       "Originally, THAI plans to borrow Bt28 billion to ease liquidity. The short-term loans will be used to retire long-term loans. So far, we have tapped Bt18 billion and we need another Bt10 billion. The borrowing details should be concluded shortly. The borrowing should ensure the company's liquidity throughout the year 2009," he said.
       The national carrier last year posted a net loss of Bt21 billion, the first time in decades. Though in the first quarter it earned Bt7.9 billion in net profit, the company posted a net loss of Bt5.4 billion in the second quarter as a result of the economic slowdown, the flu and domestic political turbulence.
       The board yesterday was informed that the company's operations showed improvement in August, when the average cabin factor increased slightly, to 75 per cent. The cabin factor of domestic flights in the month stood at 82 per cent, that of European routes at 78 per cent and that of regional routes like China and Japan at 70 per cent.
       Ampon noted that the figures improved significantly from July and this convinced the board that the annualised performance would swing back to positive territory this year.