Because of a writedown on recent foreign exchange losses, Thai Airways International has suffered a massive loss of 26.7 billion baht ($578.3 million) in its latest quarter.

The loss for the quarter ending in December, the first in Thai's financial year, compares with a 1.5 billion baht net profit a year ago.

Under local Thai rules, the airline is required to account for any foreign exchange losses over a five year period, or alternatively in one single provision. The airline has elected for the latter option and, in doing so, has wiped out a 1.4 billion baht profit before adjustment.

Financial analysts suggest that the company is taking the writedown to make it "look as unattractive as possible" to secure tax concessions over the next three to five years. The airline is also keen to absorb the loss now, ahead of its anticipated privatisation.

Source: Flight International