Continued traffic and load factor growth for China Southern; Hainan Airlines shares stronger


China Southern reported continued double-digit year-on-year traffic gains, with passenger numbers increasing 17% to 6.0 million. Domestic passenger numbers gained 15% to 5.5 million, international passenger numbers were up considerably, by 41% to 420,070 and regional passengers rose 34% to 127,010.

  • China Southern Airlines reported a 17% increase in passenger numbers, with domestic, international, and regional passengers all showing significant growth.
  • The airline's shares initially gained but later slipped due to the Chinese government's decision to loosen controls on the exchange rate.
  • China Southern's passenger load factors improved by 3.4 percentage points to 75%, and cargo volumes also increased.
  • Air China's shares slipped after reaching a two-year high, while Hainan Airlines experienced gains due to the approval of a plan to boost tourism in Hainan Province.
  • Thai Airways' shares gained, while Singapore Airlines and Malaysia Airlines remained flat.
  • Qantas, Air New Zealand, and Virgin Blue shares declined in the South Pacific region.

China Southern Airlines' shares slipped 2.7% yesterday, following a 6.5% gain on Monday (which was the largest gain in three weeks), as the Chinese Government moved to loosen controls on the exchange rate, allowing the Yuan to strengthen against the US Dollar.

China Southern's passenger load factors also improved by 3.4 ppts to 75%, while cargo volumes gained 34.9% to 89,980 tonnes. The airline's shares fell 2.7% yesterday.

Similarly, shares in Air China slipped 0.6% yesterday, after surging 6% to a two-year high in Hong Kong trading on 21-Jun-2010.

Hainan Airlines gained 4.3% yesterday, following a 9.9% advance on 21-Jun-2010. The carrier's shares have also been positively affected by the National Development and Reform Commission's approval of a plan (first announced in Dec-2009) to make Hainan Province an international tourism destination. See related report: Hainan Airlines parent, HNA Group, supercharged for growth

In Southeast Asia, shares in Thai Airways gained 2.8%, while Singapore Airlines and Malaysia Airlines remained flat. In the South Pacific, Qantas, Air New Zealand and Virgin Blue shares all declined, by 2.0%, 1.7% and 1.6%, respectively.

Asia Pacific selected airlines daily share price movements (% change): 22-Jun-2010

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