August 10, 2018 / 5:36 AM / 5 days ago

Thai budget carriers' losses mount, shares tumble

BANGKOK, Aug 10 (Reuters) - Thailand’s low-cost carriers saw share prices falling nearly 7 percent in morning trade in Bangkok on Friday after they reported losses due to tough competition and higher fuel costs.

Asia Aviation Pcl, AirAsia Group Bhd’s partner in Thai AirAsia, reported a loss of 306 million baht ($9.21 million) for its April-June period versus a profit of 170 million baht a year ago, sending its shares down over 4 percent.

Losses at rival Nok Air Pcl widened to 830 million baht in the quarter versus losses of 650 million baht a year ago. Nok’s share prices were trading 7 percent lower.

Despite Thailand’s tourism boom, its airlines have struggled due to higher jet fuel prices, a drop in passengers from off-peak travelling and stiff competition.

The country expects tourist arrivals to reach 37.5 million this year, up 6 percent from 2017.

Nok Air, the budget arm national carrier Thai Airways International Pcl, saw revenue dropping 1 percent to 3.35 billion baht.

Thai AirAsia is planning to add more routes between India and Southeast Asia in the next quarter to minimise the risk of depending on a major customer base in the region, the airline said.

“Higher fuel costs have been a challenge with fuel being a major operating cost for any airlines,” Thai AirAsia Chief Executive Santisuk Klongchaiya said in a statement.

Analysts say tourist seasonality next quarter should help recovery and that plans to introduce a fuel surcharge could partly offset higher jet fuel prices. ($1 = 33.2200 baht) (Reporting by Chayut Setboonsarng; Editing by Gopakumar Warrier)

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