Bafs revises up revenue forecast on higher Suvarnabhumi demand
Bangkok Aviation Fuel Services Plc (Bafs) has revised up its 2007 revenue projection by more than 15% following higher-than-expected service volume at Suvarnabhumi Airport. The company now expects to earn between 1.84 billion and 1.91 billion baht, up from 1.6 billion forecast previously. Last year its revenue was 1.53 billion baht.
Earlier, the aircraft refuelling service provider predicted volume would expand 5% from 4.27 billion litres last year.
But volume will likely rise 7.5% to 4.58 billion litres as its combined uplift volume at Don Muang and Suvarnabhumi airports in the first six months has jumped 7.5% year-on-year to 2.27 billion litres.
''Service volume in the second half could repeat the growth rate in the first half because of seasonal reasons. Normally, the peak tourist season in Thailand and elsewhere lasts from the fourth quarter to the first quarter,'' said M.R. Supadis Diskul, the managing director of Bafs.
''It's good news for us to hear that about 20 airlines would add over 100 flights per week to Thailand from October to March to serve tourist demand. In addition, we expect operations of Air Bagan of Burma, Air India express and charter flights by Sky Star, the newcomers at Suvarnabhumi Airport, would benefit our performance despite their small business scales,'' said M.R. Supadis.
Starting on Oct 1, Bafs plans to charge clients for depot and hydrant fees in Thai baht terms, aiming to better manage foreign-exchange risks.
M.R. Supadis said the company's net profit fell by three million baht each time the baht strengthens one baht against the US dollar.
Bafs' service fee at Suvarnabhumi would rise to 46 satang per litre from US$0.05 gallon. At the same time, the charge at Don Muang Airport would change to 55 satang per litres from around $0.027 per gallon, noted M.R. Supadis.
He said the company made deals with oil companies and clients to fix foreign exchange rates for its revenue at Suvarnabhumi Airport at 34.88 baht to a US dollar and 34.71 baht at Don Muang.
''We won't change our fixed foreign-exchange rates despite the baht depreciation in the future to operate fair businesses with our clients and jet fuel suppliers,'' said M.R. Supadis.
However, oil companies that are Bafs customers could choose to pay some fees with either dollars or baht.
''The alternative would help our clients compete with their common rival, Aircraft Service International Group (ASIG), effectively at both Don Muang and Suvarnabhumi airports,'' said M.R. Supadis.
''This financial policy could decrease our income unless we earn more from growing our uplift volume. The change results in a reduction of our service fees by 3%. However, better risk management is our foremost advantage.''
Bafs reported a first-half net profit of 315.8 million baht on sales of 1.13 billion baht. Second-quarter net profit rose 51.5% year-on-year to 153.2 million baht, on sales of 544.5 million, up 85.3%.
The company's net profit margin in the second quarter fell slightly year-on-year to 28.1% from 34.4%.
Source: Bangkok Post by Aranee Jaiimsin
Saturday September 01, 2007