The share price of Airports of Thailand Public Company Limited (SET: AOT) dropped 2% at the open on Friday following several reports that could negatively impact the financial performance of the company.
Yesterday, financial data of King Power Duty Free Co., Ltd. (KPD) showed that in 2024, KPD’s net loss widened to THB 937 million and equity fell to THB 672 million. Soaring interest expenses and intensifying competition highlight serious challenges amid sluggish travel and economic uncertainties.
This morning, AOT disclosed information regarding its Board of Directors resolution to approve a new payment relief scheme aimed at supporting concessionaires and airlines grappling with persistent liquidity challenges. KPD’s minimum guarantee payments are to be split into installments and extended for another 8 months of each trance.
Following this development, Maybank Securities (Thailand) (MST) reiterated its “BUY” recommendation on AOT with a target price at THB 33.50 per share, stating that owing debt from this new extension will not exceed bank guarantee. AOT also reaffirmed in its announcement earlier that the company has a robust and stable financial position.
Maybank added that as of 2QFY25, the amount of deferred payment appeared in the financial statement under non-current trade accounts receivable is now reported at THB6.5b (from THB2.0b at FY24 year end.) The firm estimates the minimum outstanding late payment will rise to THB12.5b by the end of Oct’25. Maybank anticipates that the outstanding debt owed by KPD will not exceed bank guarantee worth around THB 11.8 billion plus THB1.45 billion additional collateral. (THB13.3b in total). Despite concern over the financial impact to AOT, Maybank confirmed that these payment delays will not need to set provisions as it will be fully covered by bank guarantees.
