Event:
Air China Limited(601111) , China Eastern Airlines Corporation Limited(600115) , China Southern Airlines Company Limited(600029) issued the annual report for 2021, with losses of 16.642 billion yuan, 12.214 billion yuan and 12.103 billion yuan respectively, in line with the previous performance forecast.
Comments:
Total loss of revenue of the three airlines. In 2021, the total transportation turnover, passenger transportation and cargo and mail transportation volume of the whole industry will be 85.7 billion ton kilometers, 440 million person times and 7.32 million tons, with a year-on-year increase of 7.3%, 5.5% and 8.2%, returning to 66%, 67% and 97% in 2019. However, in 2021, Air China Limited(601111) , China Eastern Airlines Corporation Limited(600115) , China Southern Airlines Company Limited(600029) achieved revenue of 74.532 billion yuan, 67.127 billion yuan and 101644 billion yuan respectively, with a year-on-year increase of 7.23%, 14.48% and 9.81% respectively. The net profit attributable to the parent company lost 16.642 billion yuan, 12.214 billion yuan and 12.103 billion yuan respectively, all in line with the previous performance forecast.
The epidemic affects business data. In 2021, the total ask of the three airlines reached 507875 million passenger kilometers, recovering to 88.51% in 2019; The total RPK reached 356443 million passenger kilometers, recovering to 74.92% in 2019; The total seating rate is 70.18%, recovering to 84.65% in 2019 The revenue of Air China Limited(601111) , China Eastern Airlines Corporation Limited(600115) , China Southern Airlines Company Limited(600029) unit passenger kilometers was 0.56 yuan, 0.53 yuan and 0.49 yuan respectively, with a year-on-year increase of 9.85%, 7.93% and 6.62% respectively, and the revenue capacity of Airlines was improved.
With the rise of crude oil cost, 2022q1 airlines may be under pressure. Since 2021, the crude oil price has continued to rise, and the crude oil cost pressure of airlines has become prominent. By March 2021, the ex factory price of aviation kerosene had reached 6022 yuan / ton, with a year-on-year increase of 60.67% and a month on month increase of 12.06%. Since 2022, China has raised fuel surcharges for three consecutive times to ease the pressure of rising fuel costs. On February 5, 2022, Air China resumed the collection of fuel surcharges, charging 10 yuan per passenger within 800 kilometers and 20 yuan per passenger above 800 kilometers; On March 5, the surcharge was raised to 20 yuan and 40 yuan respectively; On March 31, the fuel surcharge was raised to 50 yuan and 100 yuan respectively. However, since the second half of 2021, China has been continuously disturbed by the scattered epidemic. The passenger volume of 21h2 civil aviation has reached 195 million, a year-on-year decrease of 27.8%. The prices of some provincial and municipal routes greatly disturbed by the epidemic have fallen, making it difficult to cover the rise of crude oil costs. In 2022q1, China’s epidemic spread to 28 provinces and cities, with a large-scale increase in newly confirmed and asymptomatic cases. Under the dual pressure of demand and cost, airlines may be under pressure.
Investment strategy. In the short term, affected by the sharp rise in crude oil costs and the disturbance of China’s scattered epidemic, 22q1 civil aviation may still maintain a substantial loss. In the long run, the certainty of aviation recovery is strong. From 2022 to 2024, the three major airlines are expected to net increase the introduction of 117, 81 and 6 aircraft (excluding the introduction of 737max8). The supply maintains a low growth rate. After the epidemic is controlled, the retaliatory travel rebound or promote the rapid rise of ticket prices. It is suggested to pay attention to Air China Limited(601111) ( Air China Limited(601111) ), China Eastern Airlines Corporation Limited(600115) ( China Eastern Airlines Corporation Limited(600115) ), China Southern Airlines Company Limited(600029) ( China Southern Airlines Company Limited(600029) ) which are greatly affected by the restoration of international routes.
Risk tips: repeated epidemics, changes in industrial policies, intensified competition, macroeconomic downturn, exchange rate fluctuations, rising crude oil prices, less than expected relaxation of prevention and control policies, etc.
