Airline Finance News - Asia / Pacific

AirGuide Business, March 24, 2008

Mar 24, 2008

Adam Air

Adam Suherman, the airline's president director, told reporters later that the firm needed a cash injection and faced a deadline later this week over insurance payments or it would have to cease operations temporarily. PT Bhakti, an investment firm which indirectly owns 50 percent of Adam Air, will sell its stake in the troubled airline back to Suherman, the founding shareholder, for IDR100 billion rupiah (USD$11 million), according to Hotman Paris Hutapea, a lawyer acting for Bhakti. Mar 18, 2008

Air China

Air China added five new international routes during the year as well as a handful of domestic services. It expanded its fleet from 191 aircraft to 220, excluding Air Macau. Passenger boardings increased 10.6% to 34.8 million, boosting related revenue 16% to CNY43.6 billion. Traffic climbed 11.1% to 67 billion and load factor improved 2.7 points to 78.6%. Mar 19, 2008

Air China

Air China will boost net earnings to CNY5.89 billion in 2008 and to CNY6.91 billion in 2009 owing to a tourism boom generated by the Beijing Olympic Games. Air China will maintain its bid to purchase 2.9 billion China Eastern Airlines H shares for at least HK$5 ($0.64) per share despite a recent slump in share price. Mar 19, 2008

Air China

Air China will boost its capital expenditure by 6 percent to CNY18 billion yuan (USD$2.54 billion) this year, and still hopes to tie up with rival China Eastern, executives said on Tuesday after the Chinese flag carrier posted forecast-beating results. In January, the parent group of Air China formally proposed a strategic partnership with China Eastern, after China Eastern's minority shareholders vetoed a USD$920 million plan to sell a 24 percent stake to Singapore Airlines and Temasek. But China Eastern rejected the Air China proposal, which involved a cash injection of USD$1.9 billion and involved a broad tie-up between the two airlines' operations. Earlier, Singapore Airlines said it was still in talks with China Eastern over taking a stake. Mar 18, 2008

Air China

Air China posted a 19 percent rise in second-half profit on Monday thanks to a stronger yuan and traffic growth, but rising fuel prices loom in 2008 along with a more gloomy outlook for global travel. Air China posted a net profit of CNY2.66 billion yuan for the second half ended December 31 versus CNY2.23 billion last year. For the full year, the group posted a 57 percent rise in profit to CNY4.23 billion. Profit from operations came in at CNY3.83 billion, up 52.3 percent. But a slowdown in growth could be inevitable, analysts warn, as Air China and other airlines around the world face mounting concerns over a slowdown in global business and personal travel. Mar 17, 2008

Air China

Air China's 2007 profit soars 57%, driven by a growing domestic economy and the appreciation of the yuan, Air China and Air Macau parent Air China Ltd. posted a net profit of CNY4.23 billion ($595.5 million) in 2007, up 57.3% over the CNY 2.69 billion reported in 2006, on a 14.2% lift in operating revenue to CNY 51.33 billion. Operating expenses rose 12% year-over-year to CNY47.5 billion with jet fuel accounting for 36%, although those costs were offset partially by hedging that helped reduce expenses by CNY236 million. Mar 19, 2008

Cathay Pacific Airways, Dragonair

Cathay Pacific Airways and Dragonair flew 7 billion RPKs in February, up 19% from the year-ago month, against a 15.7% increase in capacity to 9.01 billion ASKs. Load factor rose 2.1 points to 77.6%. Mar 18, 2008

Japan Airlines, All Nippon Airlines

Japan Airlines and All Nippon Airlines are expecting that four unions representing cockpit crew, ground staff and some cabin attendants may conduct a one-day strike today that would affect about 2% of domestic services. Mar 19, 2008

Qantas Airways

Qantas Airways warned senior management and staff, but not the markets, that its fuel bill could climb by A$1 billion ($930.8 million) in the fiscal year ending June 30, 2009. In a private e-mail to senior management obtained by Melbourne's The Age's BusinessDay, CEO Geoff Dixon announced a hiring freeze across the airline group. According to the paper, while Qantas' fuel costs are fully hedged for the current financial year, it is only 25% hedged from July at $83 a barrel. The Age claimed Qantas will find itself at a competitive disadvantage with rival Virgin Blue, which is 70% hedged for the next financial year at $76 per barrel. The paper added that some Australian analysts are wondering why Qantas issued the warning to staff but not shareholders and/or the market. Qantas boasts an excellent track record in responding to such challenges and in the past four years its Sustainable Future Program, which is to be extended, has delivered A$2.6 billion in savings. Savings of a further A$1.5 billion have been promised by June 2010. Mar 17, 2008

Singapore Airlines, China Eastern

Singapore Airlines said on Tuesday it was still in talks with China Eastern over acquiring a stake, as it seeks to get a foot into the world's fastest-growing aviation market and offset slower demand in the Americas. The world's second-biggest carrier by market value is seeking growth in new markets, after reporting the first signs of a drop in passenger demand in February. Singapore Air's bid for a stake in China Eastern at HKD$3.80 per share was rejected by the mainland carrier's shareholders in January after Air China made a counter-offer of HKD$5. Air China on Tuesday maintained its offer. China Eastern's Hong Kong-listed shares spiked 12.4 percent in early trade, but reversed the gains to lose 3.2 percent by mid-session to HKD$3.36. Singapore Air shares slipped 0.4 percent in line with the broader market, while rival Air China was down 6.1 percent. SIA's Forshaw said Singapore Air was committed to its offer. Mar 18, 2008