AAV to Admit to ICU.!?
AAV to Admit to ICU.!?
AAV to Admit to ICU.!?
12 พ.ย. 2563

Following a disappointing performance of Asia Aviation Public Company Limited (AAV) in 3Q20 as the loss surged as high as 1,836 million baht, people are worry that AAV would end up under the same circumstances as Thai Airways International Public Company Limited (THAI) and Nok Airlines Public Company Limited (NOK) in the Central Bankruptcy Court.
 
The loss mainly due to a collapse in revenue of 75% to stand at 2,403 million baht despite total expenses were decreased by 46% to 5,520 million baht, but a decline in expenses isn’t sufficient to offset the loss, reflecting an inefficient cost management..!!
 
Hence, loss from operating activities amounted to 3,118 million baht.
 
To make matters worse, Thai AirAsia Company Limited, a subsidiary of AAV, as at 30 September 2020, total assets amounted to 49,494.7 million baht, while total liabilities amounted to 51,497.9 million baht, and total shareholders’ equity deficit amounted to 2,003 million baht.
 
If this situation continues, AAV would have to follow in THAI and NOK’s footsteps to seek rehabilitation plans.
 
So, AAV is about to be admitted into ICU..?
 
The hopes for recovery in 4Q20 is cloudy as the airspace has yet to open officially and border close between countries after the resurgence of Covid-19 pandemic even though the vaccine is set to ready. 
 
Moreover, as 30 September 2020 ended, AAV had net cash used in operating activities in an amount of 335.6 million baht, while the net decrease in cash and cash equivalents amounted to 1,548.1 million baht. Cash and cash equivalents at the beginning of the period was 3,982 million baht, but cash and cash equivalents at the end of the period decreased to 2,351 million baht, reflecting cash lost during the period of 1,631 million baht.
 
AAV is one of the airlines that had proposed the government assist for soft loan in order to lessen the effect caused by Covid-19 outbreak. Tourism and aviation are the hardest-hit industry by the pandemic due to travel restrictive measures and country lockdown, but it’s still yet to be clear whether the government provides relief for airlines as only lowering taxation for jet fuel from 4.726 baht per liter to 0.20 baht per liter is inadequate.  