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China Eastern forecasts 50% rise in income
By Winny Wang |
July 16, 2010, Friday
|
Online Edition
Online Edition
CHINA Eastern Airlines expects a 50 percent increase in net income in the first half of this year with the recovering aviation market and acquisition of its smaller local rival Shanghai Airlines.
The country's second-largest carrier is estimated to earn more than 1.76 billion yuan (US$260 million) in the first half, compared with 1.17 billion yuan a year earlier, it said in a preliminary report to the Shanghai Stock Exchange.
China Eastern attributed the growth to robust demand, booming passenger volume generated by the Shanghai World Expo and reduced costs by acquisition of Shanghai Air.
The Shanghai-based carrier delivered 30 million passengers in the first half of this year, rising 44.89 percent from a year earlier, and 718,910 tons of cargo, growing 73.93 percent.
"The result is similar to our expectation and the carrier's aviation business improved significantly in the second quarter of this year thanks to eased competition and robust demand from the World Expo," said Li Lifang, an analyst at Sinolink Securities Co.
"China Eastern's takeover of Shanghai Air eased cut-throat competition in the Shanghai market to help boost the carrier's profitability," Li said.
Li also noted that the carrier's third-quarter profit is expected to reach 3 billion yuan as more students will visit Shanghai World Expo during the summer holiday, which will raise its ticket prices and load factor.
China Eastern acquired Shanghai Air in a share swap to increase its market share to more than 50 percent in Shanghai. Now the carrier owns an operating capital of more than 150 billion yuan, a fleet of 331 aircraft and more than 600 routes linking 151 destinations.
The country's second-largest carrier is estimated to earn more than 1.76 billion yuan (US$260 million) in the first half, compared with 1.17 billion yuan a year earlier, it said in a preliminary report to the Shanghai Stock Exchange.
China Eastern attributed the growth to robust demand, booming passenger volume generated by the Shanghai World Expo and reduced costs by acquisition of Shanghai Air.
The Shanghai-based carrier delivered 30 million passengers in the first half of this year, rising 44.89 percent from a year earlier, and 718,910 tons of cargo, growing 73.93 percent.
"The result is similar to our expectation and the carrier's aviation business improved significantly in the second quarter of this year thanks to eased competition and robust demand from the World Expo," said Li Lifang, an analyst at Sinolink Securities Co.
"China Eastern's takeover of Shanghai Air eased cut-throat competition in the Shanghai market to help boost the carrier's profitability," Li said.
Li also noted that the carrier's third-quarter profit is expected to reach 3 billion yuan as more students will visit Shanghai World Expo during the summer holiday, which will raise its ticket prices and load factor.
China Eastern acquired Shanghai Air in a share swap to increase its market share to more than 50 percent in Shanghai. Now the carrier owns an operating capital of more than 150 billion yuan, a fleet of 331 aircraft and more than 600 routes linking 151 destinations.
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