Airline flies into profit after measures
By Winny Wang |
December 10, 2009, Thursday
|
Print Edition
Print Edition
CHINA Eastern Airlines flew into a net profit of 1.85 billion yuan (US$271 million) in the first 10 months of this year after the loss-making company implemented several measures, including cash injection and a merger.
"China Eastern has improved a lot in structure and assets, but it is still in a difficult period and requires rapid reforms," Liu Shaoyong, the carrier's chairman, said yesterday.
The company has revamped more than 180 positions this year and plans to shed 3 percent of its management staff next year to increase efficiency, Liu said.
The profit is a big improvement for the carrier after its record 14 billion-yuan loss last year, and was attributed to the recovering economy that has boosted air travel demand and to fuel hedging gains.
The Shanghai-based airline is expected to complete a share placement of 7 billion yuan by the end of this year, which will decrease its debt-to-asset ratio to 94.7 percent.
It has also gained approval from the central government to take over its smaller rival Shanghai Airlines, and the legal procedures of the deal will be closed by the end of this year.
China Eastern, the country's third-largest carrier, will boost its presence in southeast China after the merger, such as opening express routes in Fujian Province, Liu said.
The airline carried 4.17 million passengers in October, a rise of 17.43 percent from a year earlier and 14.02 percent on a monthly basis. In the first 10 months of this year, passenger volume climbed 19.8 percent from a year earlier.
In the third quarter, the carrier gained 154 million yuan from fuel hedging contracts.
"China Eastern has improved a lot in structure and assets, but it is still in a difficult period and requires rapid reforms," Liu Shaoyong, the carrier's chairman, said yesterday.
The company has revamped more than 180 positions this year and plans to shed 3 percent of its management staff next year to increase efficiency, Liu said.
The profit is a big improvement for the carrier after its record 14 billion-yuan loss last year, and was attributed to the recovering economy that has boosted air travel demand and to fuel hedging gains.
The Shanghai-based airline is expected to complete a share placement of 7 billion yuan by the end of this year, which will decrease its debt-to-asset ratio to 94.7 percent.
It has also gained approval from the central government to take over its smaller rival Shanghai Airlines, and the legal procedures of the deal will be closed by the end of this year.
China Eastern, the country's third-largest carrier, will boost its presence in southeast China after the merger, such as opening express routes in Fujian Province, Liu said.
The airline carried 4.17 million passengers in October, a rise of 17.43 percent from a year earlier and 14.02 percent on a monthly basis. In the first 10 months of this year, passenger volume climbed 19.8 percent from a year earlier.
In the third quarter, the carrier gained 154 million yuan from fuel hedging contracts.
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