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China Southern Airlines H1 net loss 843 mln yuan on higher fuel costs


BEIJING (XFNews) - US-listed China Southern Airlines Co Ltd (SHA 600029; HK 1055; ADR ZNH), one of China's three largest airlines, reported a net loss of 843 mln yuan in the first half, versus a profit of 333 mln a year earlier, due to higher fuel costs. 

The loss per share was 0.19 yuan in the first half, against earnings of 0.08 a year earlier. In its half year report, the Guangzhou-based airline said jet fuel costs in the first six months rose 104.58 pct to 5.55 bln yuan from a year earlier.

"China Southern Airlines' acquisition of its affiliates -- Northern Airlines and Xinjiang Airlines -- also increased costs due to staffing, equipment, aircraft leasing and interest," said Zhao Mei, an analyst with Xiangcai Securities Co Ltd. Li Lei, an analyst with Huaxia Securities Co Ltd, said a new fuel surcharge levied on passenger tickets will partly offset surging fuel costs in the second half.

State media reported earlier that Chinese airlines, following the lead of other global carriers, have been authorized to levy a fuel surcharge on passenger tickets to offset surging fuel costs beginning August 1.

Total revenue rose 61.66 pct to 18.05 bln yuan in the first half while costs surged 81.45 pct to 15.92 bln from a year earlier.

The airline carried a total of 20.26 mln passengers in the first half, up 52.16 pct from a year earlier. Cargo throughput in the six-month period rose 30.45 pct year-on-year to 348,010 tons.

China Southern Airlines did not provide a forecast for the rest of the year. The figures were unaudited and prepared under Chinese accounting standards.

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