Source: ATW Daily News Author: 02/18/2009
Subject Concerned: Airlines Aviation Fuel
Shenzhen Airlines reported 26 million yuan (US$3.8 million) in net earnings in 2008, its 15th consecutive full-year profit. It earned 640 million yuan in 2007.
The carrier credited "effective cost control" for the result, which contrasts with heavy losses reported by other Chinese carriers. Last year the airline reduced operating expenses by 714 million yuan.
Industry analysts suggested that a lack of fuel hedges contributed to its success as China Eastern Airlines and Air China suffered losses of 6.2 billion yuan and 6.8 billion yuan respectively resulting from Dec. 31 writedowns in the value of their fuel hedges.
Shenzhen's 2008 operating revenue climbed 26.4% year-over-year to 13.07 billion yuan. Passenger boardings jumped 24.1% to 12.1 million while cargo volume rose 10.3% to 279,700 tonnes.
Looking ahead, the company said it does not intend to cut workers or salaries. It launched its Kunming Airlines subsidiary over the weekend, plans to establish its Hunan branch company by year-end and continues to prepare for the launch of its Ningxia Airlines subsidiary.