In 2021, which experienced huge losses in the industry, in the first quarter of 2022, under the repeated influence of the Chinese epidemic, the performance of the aviation company continued to decline.
On April 28, Air China Limited(601111) ( Air China Limited(601111) ) and China Southern Airlines Company Limited(600029) ( China Southern Airlines Company Limited(600029) ) of the three major airlines released the first quarterly report of 2022 China Southern Airlines Company Limited(600029) in the first quarter, the operating revenue reached 21.471 billion yuan, a year-on-year increase of 1.03%; Net profit loss of 4.496 billion yuan; The basic earnings per share was -0.27 yuan / share, with a year-on-year increase of 3.85%. Air China achieved an operating revenue of 12.918 billion yuan in the first quarter, down 11.41% year-on-year; Net profit loss of 8.9 billion yuan; Basic earnings per share – 0.65%.
In 2021, the three major airlines suffered losses of more than 10 billion yuan, with Air China Limited(601111) net loss of 16.64 billion yuan, an increase of 15.48% over the previous year China Southern Airlines Company Limited(600029) the company had a net loss of 12.103 billion yuan, an increase of 1.261 billion yuan over the previous year; The net loss of China Eastern Airlines ( China Eastern Airlines Corporation Limited(600115) ) reached 12.214 billion yuan, an increase of 380 million yuan over the previous year.
Although the first quarterly report of 2022 has not been disclosed yet, the performance of China Eastern Airlines during the period is not optimistic.
According to the operation data disclosed by China Eastern Airlines in March, during the period, the company’s passenger transport capacity investment (calculated by available seat kilometers) decreased by 62.35% year-on-year, of which the passenger transport capacity investment of China, international and regional routes decreased by 63.07%, 38.8% and 11.48% year-on-year respectively; Passenger turnover (calculated by passenger kilometers) decreased by 69.32% year-on-year, of which the passenger turnover of China, international and regional routes decreased by 70.01%, 16% and 35.91% year-on-year respectively; The occupancy rate was 59.43%, a year-on-year decrease of 13.5 percentage points, of which the occupancy rate of Chinese and regional routes decreased by 13.88 and 14.55 percentage points respectively year-on-year, and the occupancy rate of international routes increased by 13.38 percentage points.
In terms of cargo, in March, China Eastern Airlines cargo business included passenger plane cargo business under normal circumstances (mainly passenger belly cabin business) and passenger plane cargo business under unconventional circumstances (mainly “passenger to cargo” business), and this business has been exclusively operated by China Cargo Airlines Co., Ltd. In March 2022, the freight and mail turnover (calculated by freight and mail ton kilometers) decreased by 17.75% year-on-year.
For the decline of business data, China Eastern Airlines attributed to the rebound and high-level operation of newly confirmed cases of covid-19 pneumonia in the world. The frequency of local outbreaks caused by overseas imported outbreaks increased significantly, and the scope of spread continued to expand. The local aggregated outbreaks showed the characteristics of many points, wide range and frequent occurrence. The cases of Omikron in many provinces and cities in China increased rapidly.
For the huge loss of performance, Air China Limited(601111) also said in the first quarterly report that it was mainly affected by the multi-point spread of the epidemic in China, the rise of aviation fuel prices and other factors.
In addition to the aviation department, on April 28, Shenzhen Airport Co.Ltd(000089) ( Shenzhen Airport Co.Ltd(000089) ) disclosed the first quarterly report. In the first quarter of 2022, the company achieved an operating revenue of 648 million yuan, a year-on-year decrease of 17.65%; The net profit loss was 299 million yuan, down 697.96% year-on-year.
Shenzhen Airport Co.Ltd(000089) said that during the reporting period, the company was seriously affected by the epidemic of novel coronavirus pneumonia, and passenger throughput and take-off and landing sorties decreased significantly year-on-year, resulting in a year-on-year decline in the company’s operating revenue, total profit and net profit attributable to shareholders of the listed company.
China Southern Airlines Company Limited(600029) also launched a foreign exchange risk management plan under many uncertain factors such as the epidemic situation and oil price. On the evening of April 28, the company announced that the foreign exchange risk management tools to be carried out by the company include forward, neckline option or guaranteed forward, and select financial derivatives with simple structure, strong liquidity and recognizable risk to carry out hedging transactions.
In order to avoid the risk of foreign currency derivatives, prepayment and other risks that may affect the company’s financial performance, the company can choose to hedge the exchange rate of aircraft oil and prepayment for the purpose of avoiding the risk that the exchange rate of aircraft oil and prepayment will have a significant impact on the company’s financial performance.
