Asia Aviation Public Company Limited (SET: AAV) delivered a robust operational performance for the first quarter of 2026, characterized by a significant climb in core profitability and passenger volume. While the company’s core earnings soared, a heavy non-cash foreign exchange loss moderated its bottom line compared to the same period last year.
Total revenues for the quarter reached THB 14,057 million, marking a 4% increase year-on-year. This growth was primarily fueled by an 11% rise in passengers carried, totaling 6.2 million guests, as Thai AirAsia (TAA) expanded its domestic market share to a record 42%. However, the top-line growth was slightly tempered by a 6% decline in average fares to THB 1,836 and an 8% drop in ancillary income, largely due to a processing fee waiver.
AAV demonstrated disciplined cost management during 1Q26. Selling and Administrative (SG&A) expenses fell 13% to THB 795.8 million, driven by reduced advertising and lower commissions to online travel agents. The Cost per Available Seat Kilometre (CASK) also decreased by 2% to THB 1.69, benefiting from efficient maintenance cycle management and lower international airport fees as the airline pivoted toward domestic routes. Fuel costs remained relatively flat, as a 6% decline in jet fuel prices offset increased consumption from capacity growth.
These operational efficiencies led to a 27% surge in core profit, which reached THB 1,651.7 million. Conversely, a sharp Baht depreciation from THB 31.74 to THB 32.99 per USD resulted in a non-cash foreign exchange loss of THB 1,013.8 million. Consequently, the reported net profit for the quarter was THB 840.6 million, a 39% decrease compared to 1Q25. Despite this, EBITDA rose 11% to THB 3,733.9 million, with margins improving to 28%.
Looking ahead, management noted that geopolitical tensions in the Middle East have caused volatile jet fuel prices, prompting TAA to adjust capacity and pricing for the second quarter. To strengthen its capital position, AAV plans to issue up to THB 4,000 million in debentures in June 2026.
