Source: Bloomberg News Author: Tian Ying 07/30/2008
Subject Concerned: Government Opinion Airport
Beijing Capital International Airport Co., operator of Asia's second-busiest airfield, fell the most in almost seven years in Hong Kong trading after saying first-half profit likely dropped "significantly".
The company declined as much as 11 percent to HK$6.10 and was at HK$6.42 at 2:47 p.m.
Beijing Airport's first-half passenger numbers were little changed from a year earlier as higher fuel costs, natural disasters and government restrictions forced carriers to cancel flights. The airfield operator also opened a new terminal in February, which is bigger than all five terminals at London's Heathrow airport.
"2008 will be a bad year for the company," said Kelvin Lau, an analyst at Daiwa Institute in Hong Kong. "The growth in passenger traffic is not as fast as expected and it's now paying to rent the new terminal."
The company probably paid its parent 1.5 billion yuan (US$219 million) in the first half to rent the new facility and airfield equipment, he added.
Beijing Airport handled 26.1 million passengers in the first half. The airport operator has applied to buy the terminal from its parent, Capital Airports Holding Co.
Chinese airlines canceled regular flights this year to aid with relief efforts following the May 12 Sichuan earthquake, which killed more than 87,000 people. Planes were also grounded by snowstorms in February. The government has also forced cuts in flights to Beijing to ease congestion.
China's overall aviation industry, the world's second-biggest, posted a 23 percent decline in first-half profit, according to the Civil Aviation Administration of China (CAAC).
Beijing Airport gave the profit warning in a stock exchange statement on Jul. 29. It is scheduled to release its earnings on Aug. 22.