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Bangkok Airways Public Company Limited (SET:BA), 66.47% stake owned by Puttipong Prasarttong-Osoth, Bangkok Airways President, and the Prasarttong-Osoth family, is a Thailand-based company engaged in the provision of air transportation and airport services. The company’s business activities consist of three core business segments: The airline passenger services, providing full-service scheduled flights in a premium level to both business and leisure travelers, the airport-related businesses, including ground services, in-flight catering, and cargo services, and Airport business, in which the company owns and operates Samui Airport, Trat Airport and Sukhothai Airport.
Bangkok Airways currently operates twelve A319-100s, eight A320-200s, and thirteen ATR72-500/600s on regular flights throughout Thailand, as well as to Bangladesh, Vietnam, Laos, India, Myanmar, Cambodia, the Maldives, China, Hong Kong, and Malaysia. Its subsidiaries comprise Bangkok Airways Holding Co., Ltd, Bangkok Airways Ground Services Co., Ltd., Worldwide Flight Services Bangkok Air Ground Handling Co., Ltd., and Bangkok Air Catering Co., Ltd.
BA said on August 10 that its revenues for the second-quarter 2016 were 5.35 billion baht, missing the 5.46 billion baht consensus estimate of 2 analysts, according to the Financial Times. The company posted second-quarter 2016 losses of 0.061 baht per share, missing the 0.05 baht per share profit estimate of one analyst. The company blamed the net losses of 111.9 million baht on an additional tax return of 447.0 million baht, due to a change in tax calculations for companies with the Board of Investment privileges. The tax change was announced by the Ministry of Finance on June 16, 2016.
Bangkok Airways said the number of scheduled passengers jumped 11.51% to 1.24 million in the second-quarter 2016, compared to 1.11 million during the same period last year. About 71% of the passengers are domestic. The passenger load factor increased 4.6 percentage points to 64.5% in the second-quarter 2016, compared to the same period in 2015. The passenger load factor, or load factor, is the percent of seats filled by passengers and measures the capacity utilization of airlines. It is generally used to assess how efficiently the airline fills its seats and generates fare revenues. Some commercial airlines, like Delta Airlines, have a load factor of 80% or higher.
From our technical viewpoint, shares of BA have moved in a wide range since the stock started trading in October 2015. The stock bounced off the lower trendline support of the ascending channel chart pattern in July and is now bumping into a head resistance at the 25 baht level. There are several supports at the 23 and 24 baht levels, if the stock is rejected by the 25 baht resistance and pulls back.
According to the Financial Times, the consensus amongst 11 polled investment analysts covering BA gave the company an Outperform rating, with the median 12-month price target of 28 baht per share, as of August 24.
Disclosure: No position and no recommendation. |
