Recently, a number of listed airlines in China have successively released performance forecasts for 2021. The three major airlines still report losses, and the net loss has increased year-on-year compared with the average year of 2020. It is estimated that the total loss is 36.8 billion ~ 43.3 billion yuan, and Juneyao Airlines Co.Ltd(603885) and China Express Airlines Co.Ltd(002928) also recorded losses.
The profit list is occupied by Spring Airlines Co.Ltd(601021) and HNA holdings. On the one hand, the investment loss of chunhang Japan will no longer affect the consolidated statement profit, Spring Airlines Co.Ltd(601021) is expected to make a profit of 35 million to 52 million yuan; On the other hand, HNA, which has experienced bankruptcy reorganization, is expected to achieve a net profit of 4.5 billion to 6.2 billion yuan in 2021 due to the impact of the profits from debt restructuring.
three major voyages load forward
The performance forecast of Air China (601111. SH) shows that the net loss in 2021 is 14.5 billion to 17 billion yuan, and the net loss in the same period last year is 14.409 billion yuan, which is still the most serious loss among the three airlines; China Eastern Airlines (600115. SH) had a net loss of 11 billion to 13.5 billion yuan in 2021, with a loss of 11.835 billion yuan in the same period last year; China Southern Airlines (600029. SH) lost 11.3 billion yuan to 12.8 billion yuan in 2021, with a loss of 10.842 billion yuan in the same period last year, the lowest among the three airlines.
For the reasons for the pre loss of performance, the announcement of the three major airlines mentioned two factors: the continuous impact of covid-19 epidemic and the rise of oil price.
Air China said that 2021 was the second year that covid-19 pneumonia spread around the world. The investment in international routes continued to be limited, the flow of China’s passenger transport market fluctuated sharply, and it was increasingly difficult to improve the company’s operating efficiency. In addition, factors such as rising oil prices and exchange rate fluctuations have further increased the difficulty of the company’s operation. At the same time, relevant investment enterprises in the main business have also been seriously affected.
The announcement of China Southern Airlines shows that the impact of covid-19 epidemic continues, passengers’ willingness to travel is still relatively low, and the recovery of passenger transport market is weak. The company’s annual transportation capacity investment and revenue passenger kilometers in 2021 decreased by 37.8% and 46.5% respectively compared with 2019.
China Eastern Airlines said that although China’s air passenger transport volume rebounded in 2021 compared with that in 2020, the demand for international air passenger transport continued to be low due to the continued high incidence of overseas epidemics and international travel restriction policies. In addition, the continuous rise in fuel prices has increased the cost burden of airlines.
Aviation fuel cost has always been the main cost expenditure item of airlines. As mentioned in the previous report of interface news, one of the reasons for the decline in performance is the rise in aviation fuel price. Due to the increase of air transportation volume, aviation fuel cost not only returns to the dominant position, but also the sharp increase in the cost burden of airlines due to the continuous rise of international oil prices.
Air China disclosed in the financial report that if the average aviation fuel price increases or decreases by 5%, the aviation fuel cost of the group will increase or decrease by about 496 million yuan under the condition that other variables remain unchanged. China Southern Airlines said that assuming that the fuel consumption remains unchanged, every 10% increase or decrease in the average fuel price during the reporting period will lead to an increase or decrease of 1.234 billion yuan in the group’s operating costs during the reporting period.
In China’s civil aviation industry, the fuel surcharge for passenger transport on Chinese routes adopts a linkage mechanism with the price of aviation fuel. Since the second half of 2021, China Airlines has twice announced the resumption of fuel surcharge.
Spring Airlines Co.Ltd(601021) HNA holdings turned losses into profits
The net loss of Japan Airlines in 2020 was 601.7 billion yuan, which was dragged down by the consolidated statement.
In the fourth quarter of 2021, the civil aviation industry entered the traditional off-season, and it is not easy for Spring Airlines Co.Ltd(601021) to achieve full year profit. The performance forecast of 2021 shows that the expected net profit is 35 million yuan to 52 million yuan, turning losses into profits compared with the same period of last year.
As for the main reasons for the performance pre profit, Spring Airlines Co.Ltd(601021) announcement mentioned that although the epidemic began at the end of the second quarter, the pressure of overseas input increased sharply, and the epidemic in China repeated many times, the company’s main operation bases in Shanghai, Shenzhen, Shijiazhuang, Shenyang, Lanzhou, Ningbo, Yangzhou, Dalian and other places were affected to varying degrees, which continued to put pressure on the company’s daily operation, However, the company still showed the tenacious vitality of low-cost aviation, further improved its efficiency through fine management, and improved its main business indicators.
In 2021, the company’s available seat kilometers, passenger transport volume and passenger seat rate increased by 9.6%, 14.6% and 3.2 percentage points respectively compared with 2020. At the same time, the unit cost of non oil decreased year-on-year, and the revenue of passenger kilometers also increased year-on-year.
A more critical reason is that in the same period of last year, the investment loss of chunhang Japan’s long-term equity investment was recognized and the impairment was withdrawn, resulting in a loss in Spring Airlines Co.Ltd(601021) 2020. This event will no longer affect the net profit amount of the company’s consolidated statements in this year.
In July 2021, JAL announced that it had further injected capital into Spring Airlines Co.Ltd(601021) Japan and took it back. JAL said at a press conference that it had increased the proportion of capital contribution to Spring Airlines Co.Ltd(601021) Japan to two-thirds, and the company has become a subsidiary of JAL group.
Another company that announced a profit was Hainan Airlines Holding Co.Ltd(600221) (600221. SH), which suffered a huge loss of 64 billion yuan in 2020. At that time, it was also the company with the largest loss in the whole A-share market. In 2021, with the completion of Hainan Airlines Holding Co.Ltd(600221) bankruptcy reorganization, the benefits of debt restructuring will be realized, and the net profit will be 4.5 billion yuan to 6.2 billion yuan.
The announcement shows that the turnaround of the company’s performance is mainly due to restructuring, with an impact of about 16 billion yuan to 17.6 billion yuan.
Meanwhile, due to the weakening impact of covid-19 epidemic, China’s aviation market has gradually recovered. According to preliminary statistics, the operating profit in Hainan Airlines Holding Co.Ltd(600221) 2021 decreased by about 9.3 billion yuan to 9.8 billion yuan compared with the same period last year.
