UPDATE 1-Thai Airways plans share issue next year

* To raise capital next year by issuing new shares

* Aims to reduce short-term debt, cut D/E ratio to 2 times

* Expects '09 revenues of 157 bln baht, to recover next year

* Delivery of new Airbus planes are on schedule (Adds details, quotes)

By Manunphattr Dhanananaphorn

BANGKOK, Oct 19 (Reuters) - Thai Airways International THAI.BK, Thailand's largest airline, plans to issue shares next year to raise funds for repaying short-term debt, its newly appointed president said on Monday.

Piyasvasti Amranand did not say how much money the flag carrier will raise. But 29 billion baht ($869 million) of debt matures next year, he added.

Kosin Sripaiboon, a senior analyst with UOB Kay Hian Securities, said he expected Thai Airways to raise almost 20 billion baht ($600 million), or issue 800 million new shares, half of its current registered capital of 1.7 billion shares.

The carrier has a total debt of 160 billion baht.

"We need to raise capital because we have a lot of short-term debt to be repaid," Piyasvasti said.

"We are also trying to convert our short-term debt to longer maturities. As the long-term debt has a maturity of six years, that doesn't match our funding for plane procurements," he told reporters on the first day of his top job.

After the announcement, its shares erased earlier gains after climbing more than 3.0 percent. The stock closed up 1.9 percent at 21.80 baht on Monday, while the overall Thai stock market .SETI rose 2.02 higher.

The capital-raising would also help to cut the airline's debt-to-equity ratio to 2 times from more than 3.0 times now, Piyasvasti said.

The national carrier, which made a record net loss in the fourth quarter of 2008 because of the global economic slowdown and airport closures caused by political protests, is in the process of overhauling operations and restructuring management.

Earlier, Thai Airways' board approved plans to seek up to 35 billion baht of loans in short-to-medium term funding to finance its restructuring. So far, the airline has received 18 billion baht in loans from banks and was expected to get another one billion baht loans soon.

REVENUES TO IMPROVE NEXT YEAR

The airline should generate revenue of 157 billion baht this year, down 21 percent from last year, Piyasvasti said, adding that he expected improving passenger numbers to drive up revenue to 186 billion baht next year.

"For net earnings, it remains unclear. But passenger numbers recovered in the third quarter and also cabin factors are better," he said of the percentage of seats sold.

Thai Airways, 68 percent state-owned, reported revenue of 76 billion baht in the first six months and a net profit of 2.47 billion baht. Twelve analysts surveyed by Thomson Reuters I/B/E/S forecast a net profit of 2.36 billion baht for 2009.

The airline has said it aims to boost its percentage of seats sold, or cabin factor, to 73-74 percent for 2009, similar to last year's 75 percent. It reported 71.2 percent in the first half.

Second-quarter cabin factor was 64-65 percent, down from more than 80 percent in the first quarter, hit by a drop in tourist arrivals due to the global impact of the H1N1 flu virus, and fallout from political violence in Thailand in April.

The airline has said it ordered eight A330 aircraft from Airbus (EAD.PA), six of them to be delivered this year. The order of six A380 superjumbos would take delivery of its first three A380 in 2012 and another three in 2013. ($1=33.39 Baht) (Writing by Arada Kultawanich; Editing by Jason Szep)