CAPA > Aviation Analysis > Air China tops airline Enterprise Value rankings; Delta second; no LCCs in top 10

Based on data from Bloomberg, EV incorporates equity plus debt funding, thereby capturing the full financial size of the company. Last week, CAPA reviewed the market capitalisations (ie the equity valuations) of the world’s listed airlines, which again was headed by Air China.

See related reports:

• Air China value greater than United-Continental, American, JetBlue, AirTran & US Air combined. Part 1
• Skyteam Alliance members more valuable than Star and oneworld. Airline Market Caps Part 2
• So you think you know your airline market capitalisation: Part 3

Who is the greatest of them all?

The combined EV of the world’s listed airlines is USD361 billion. They operate a combined fleet of some 10,170 aircraft. Utilising the worldwide airline fleet as a basis for extrapolation, the EV of the global airline industry is just over USD1 trillion.

Air China’s EV of USD31.8 billion is some 52% higher than second biggest Delta.

Singapore Airlines (SIA) ranks second on market cap, but 15th on EV. Its market cap exceeds its EV by some USD3.7 billion, reflecting the fact that SIA is sitting on a mountain of cash – with net cash of some SGD7.3 billion (USD5.7 billion) – and a small debt load of just SGD2.1 billion (USD1.6 billion).

China Eastern, previously the target of a strategic partnership from SIA, has strong rankings on both market cap and EV scores. China Southern also features prominently.

LAN has a slightly larger EV than Lufthansa, while Hainan Airlines ranks higher than the world’s biggest LCC, Southwest Airlines, on this score.

Indeed, Southwest is the only LCC in the Top 15 listed airlines by EV. Ryanair ranks 17th - well ahead of easyJet, which is the world’s 35th largest listed carrier by this measure.

IAG (BA-Iberia) is slightly bigger than Air France-KLM at USD15.7 billion and USD15.1 billion, respectively, while Korean Air is a larger entity than United Continental.

Cathay Pacific out-ranks Singapore Airlines, which in turn tops Qantas on the EV measure.

AirAsia’s EV is USD1.7 billion greater than rival Malaysia Airlines, while GOL edges out TAM.

Indian carrier Jet Airways has a significantly higher EV than market cap, given the large debt component.

Of course, size is not everything. It is what an airline does with its assets that counts – the profits it generates. It must also be remembered that airlines do use a lot of off-balance sheet financing that can influence ratios such as EVs.

But the rankings do reflect the considerable progress that Asia Pacific airlines, particularly mainland Chinese carriers, have made in recent years as they grow their operations.

Enterprise Values (EV) and market capitalisations of the world’s leading listed airlines: USD millions

	EV (USDm)	EV Rank	Market Cap  (USDm)	Market Cap Rank	Business Model
Air China	31,790	1	18,990	1	Full service
Delta Air Lines	20,880	2	8470	10	Full service
China Southern	20,440	3	10,540	3	Full service
China Eastern	18,080	4	9200	4	Full service
All Nippon Airways	17,210	5	8800	8	Full service
IAG (BA-Iberia)	15,690	6	6850	13	Full service
Air France-KLM	15,120	7	4870	16	Full service
Korean Air Lines	15,100	8	3920	17	Full service
United Continental	14,590	9	7400	11	Full service
Cathay Pacific	12,440	10	9090	7	Full service
LAN Airlines	11,860	11	9120	6	Full service
Lufthansa	11,780	12	9160	5	Full service
Hainan Airlines	9810	13	5030	15	Full service
Southwest Airlines	9310	14	8650	9	LCC
Singapore Airlines	8970	15	12700	2	Full service
American Airlines	8860	16	2150	29	Full service
Ryanair	8450	17	6990	12	LCC
Qantas Airways	7550	18	5340	14	Full service
Thai Airways	6700	19	2740	22	Full service
China Airlines	6680	20	2920	20	Full service
Asiana Airlines	4860	22	1570	33	Full service
EVA Airways	4760	23	2560	24	Full service
AirAsia	4350	25	2240	28	LCC
Aeroflot	4310	26	2920	21	Full service
Turkish Airlines	4300	27	2600	23	Full service
US Airways	4040	28	1290	35	Full service
JetBlue	3800	30	1610	32	LCC
Jet Airways	3800	29	855	42	Full service
GOL	3490	24	3470	18	LCC
TAM	3350	21	3340	19	Full service
Air Canada	3260	31	814	44	Full service
Copa	2990	32	2280	26	Full service
Republic Airways	2750	33	298	60	Full service
Malaysia Airlines	2640	34	2040	30	Full service
easyJet	2550	35	2470	25	LCC
Alaska Air	2500	36	2030	31	Full service
SAS	2220	37	1090	37	Full service
WestJet	2080	38	2270	27	LCC
Skywest USA	2030	39	854	43	Regional
Pakistan Int'l Airlines	1830	40	72	75	Full service
Virgin Blue	1820	41	774	47	LCC
Garuda Indonesia	1730	42	1310	34	Full service
AirTran	1550	43	990	40	LCC
Shandong Airlines	1450	44	768	48	Full service
Cebu Pacific	1380	45	1250	36	LCC
Philippine Airlines	1360	46	656	51	Full service
Air New Zealand	1140	47	1030	38	Full service
Finnair	1120	48	795	45	Full service
Air Berlin	999	49	397	55	LCC
Norwegian	872	50	689	49	LCC
Tiger Airways	844	51	596	53	LCC
Skymark Airlines	808	52	994	39	Full service
El Al	755	53	192	65	Full service
Pinnacle Airlines	752	54	110	71	Regional
Allegiant	730	55	777	46	LCC
Jazz Air	684	56	672	50	Regional
Air Arabia	566	57	987	41	LCC
S7	518	58	165	67	Full service
Kenya Airways	495	59	220	62	Full service
Flybe	427	60	364	57	Regional
Jazeera Airways	410	61	92	74	LCC
Transasia Airways	404	62	325	58	Full service
SpiceJet	389	63	377	56	LCC
Aer Lingus	371	64	640	52	Full service
Croatia Airlines	295	65	147	68	Full service
Icelandair	289	66	192	64	Full service
Hawaiian	258	67	318	59	Full service
Royal Jordanian	206	68	179	66	Full service
Kuwait National	201	69	110	72	Full service
Air Mauritius	182	70	69	76	Full service
Regional Express	146	71	128	70	Regional
Dart Group (Jet2)	136	72	226	61	LCC
Vueling Airlines	120	73	422	54	LCC
Meridiana Fly	116	74	135	69	Full service
Cimber Sterling	111	75	24	78	LCC
Skywest Airlines Australia	97	76	96	73	Regional
Aegean Airlines	91	77	194	63	Full service
Cyprus Airways	64	78	22	79	Full service
Great Lakes Aviation	59	79	20	82	Regional
Baltia Air Lines	40	80	38	77	Full service
1time	21	81	21	80	LCC
Atlantic Airways	19	82	21	81	Regional

Source: Bloomberg and Centre for Asia Pacific Aviation
*EVs and Market Caps as at 03-Mar-2011 and 09-Mar-2011, respectively

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