China Southern Airlines confirmed yesterday that it was likely to receive a CNY1.5 billion (USD219 million) capital injection from its state-owned parent company funded by the Chinese Ministry of Finance, to "support the development of the airline's core business”.
The funds will help China Southern reduce its debt-assets ratio. Shares in the carrier surged 4.9% yesterday before being placed in a trading halt.
Government cash injections and support of airline rights issues has been commonplace in the Asia Pacific region lately, with Japan Airlines, Air India, Thai Airways and Malaysia Airlines among the recipients. See related report: 2010 Year of the Asian Airline Bailout: China Eastern, Air India, JAL, THAI, MAS & Garuda
Malaysia Airlines rises on improved earnings
Malaysia Airlines (MAS) is entering a rapid fleet and network growth phase, emboldened by fresh funding support under a well-supported rights issue and a return to profitability (albeit slight) in 4Q2009. Investors liked the result, sending MAS’s shares up over 5% yesterday.
Skywest surges on profit
Australian regional operator Skywest Airlines (whose parent is headquartered in Singapore) reported a pre-tax profit for the six months to ended 31-Dec-2010 of SGD10.1 million (USD7.2 million) against the previous SGD2.5 million loss, as revenue rose 10% to SGD107.1 million. Unlike Qantas, Skywest declared an interim dividend of SGD0.005.
Chairman, Jeff Chatfield, stated the result “demonstrates the importance of maintaining the business strategy of providing an excellent airline service to the coastal towns of Western Australia combined with scheduled charter for the worlds major mining and resource companies”.
Shares in the Sydney and London-listed Skywest surged 32.6% yesterday.
For this and more coverage of the region’s aviation updates, subscribe to Asia Pacific Airline Daily. Other highlights in today’s edition include:
- JAL seeking international fare fuel surcharge increase from Apr-2010 to Jun-2010;
- Xiamen Airlines takes delivery of 50th B737 (NG) aircraft;
- Garuda Indonesia to auction off four B737-400 aircraft;
- Jetstar boosts capacity between Singapore and Vietnam with new aircraft arrival.
Asia Pacific selected airlines daily share price movements (% change): 22-Feb-2010