China Southern anticipating better H2
China Southern Airlines, Asia’s largest carrier by passengers, forecasts a better second half after a loss in the first six months of 2014 as economic growth picks up and China’s currency volatility eases, chairman Si Xianmin said.
September 1, 2014
China Southern Airlines, Asia’s largest carrier by passengers, forecasts a better second half after a loss in the first six months of 2014 as economic growth picks up and China’s currency volatility eases, chairman Si Xianmin said. China Southern, which is the most dependent on the domestic market among the nation’s biggest carriers, is accelerating its overseas expansion to help improve its “unbalanced” network structure, Si said.
International flights accounted for 16.8 per cent of China Southern’s total passenger revenue last year, compared with 80.7 per cent for domestic flights. It took another step in ‘rebalancing’ it network with the start of its Guangzhou-New York route in early-August which it operates four times a week with B777-300ER aircraft. The company’s fleet, Asia’s biggest, will rise to more than 600 aircraft by the end of August, Si said.
The airline incurred a loss in the first half, the chairman said, confirming a forecast issued last month in which the carrier would incur a loss of as much as 1.1 billion yuan (US$178 million) in the first six months this year, compared with a 302 million yuan profit in the yearearlier period.
“We’ve seen a loss in the first half mainly because the economic slowdown has caused growth in the aviation market to slow,” Si told reporters in New York. “We forecast our second-half performance will surely be better than the first half. We don’t foresee big volatility in the foreign exchange rate of the yuan versus the dollar in the second half.”