by winston » Wed Oct 29, 2008 10:59 am
Air China books net loss in Q3 on high jet fuel costs, lower demand
BEIJING (XFN-ASIA) - Air China Ltd (SHA 601111; HK 0753), one of the country's top three airlines, said it posted a net loss of 1.94 bln yuan in the third quarter, following a profit of 2.19 bln a year earlier, due to high jet fuel costs and lower market demand.
In its financial results filed with the Shanghai Stock Exchange, the company said operating revenue in the third quarter fell 3.84 pct year-on-year to 13.92 bln yuan, with operating costs up 24.39 pct at 15.09 bln yuan.
The rise in crude oil prices resulted in an increase of 2.663 bln yuan in jet fuel costs, up 64 pct year-on-year, Air China said.
The airline said it booked a loss from investments in associate companies and joint ventures of 261.38 mln yuan, against a gain of 552.37 mln a year earlier.
In addition, the company also booked a loss from changes in fair value of 1.064 bln yuan, against a loss of 58.47 mln a year earlier.
"Due to the recent dramatic decline in international crude oil prices, the fair value of the fuel derivatives held was minus 961 mln yuan on Sept 30," the company said.
The fair value of the fuel derivatives is subject to further changes as crude oil prices, and financial markets adjust, it said.
The company said that the settled portion of the fuel derivatives has generated accumulated realized revenue of 378 mln yuan during the January to September period.
Operating revenue in the first nine months rose 6.61 pct year-on-year to 39.68 bln yuan despite lower passenger traffic, but operating costs were up 18.78 pct at 40.14 bln yuan.
The company carried 25.25 mln passengers and 685,400 tons of cargo in the first nine months, down 4 pct and 1.4 pct respectively from a year earlier. The overall passenger load factor for January-September stood at 74.6 pct, down 3.7 percentage points from a year earlier, while the cargo load factor was 57.6 pct, up 3.4 percentage points.
Loss per share for the nine months stood at 0.055 yuan, against EPS of 0.287 a year earlier, while the loss per share in the third quarter was 0.163 yuan, compared to EPS of 0.184 previously.
The company did not provide a forecast for the rest of the year.
It's all about "how much you made when you were right" & "how little you lost when you were wrong"