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Air China: Management discussion of Jun-2011 operating data

Direct News Source

12-Jul-2011 Passenger traffic has shown a steady year-over-year growth across the board during June 2011. As for month-over-month performance, while international traffic has increased, domestic and regional traffic decreased slightly.

In cargo, international and domestic Revenue Freighter Tonne Kilometres (RFTK) and freighter tonnage carried all achieved year-over-year increases while regional cargo routes were the exception to this trend. For month-over-month performance, regional cargo routes showed a slight rise while the other sectors experienced a decline in performance.

Passenger traffic for June achieved a higer year-over-year growth than the increase in capacity. Passenger capacity, measured in Available Seat Kilometres (ASK), was up 5.7% year-over-year while passenger traffic, measured by Revenue Passenger Kilometres (RPK), rose by 9.4%. Capacity on domestic routes increased by 4.4%, while RPK climbed 9.3% year-over-year. Capacity on international routes grew 7.9%, with RPK increasing by 9.0%. Capacity on regional routes expanded 4.5%, with RPK rising by 16.3%. The passenger load factor was 83.2%, up 2.9 percentage points year-over-year. The passenger load factor for international, domestic and regional routes increased by 0.9, 3.8 and 8.1 percentage points respectively year-over-year.

Cargo capacity, measured in Available Freighter Tonne Kilometres (AFTK), rose 1.5% year-over-year in June. Revenue Freighter Tonne Kilometres (RFTK) increased by 3.3%, and freighter tonnage carried increased by 4.7%, compared with June 2010. The cargo load factor was 62.1%, an increase of 1.1 percentage points year-over-year.

Starting from 15 June, the company launched a new international flight between Beijing and Milan three times a week. And starting from 16 June, the company also launched another new international flight between Chengdu and Tokyo two times a week.

During the month, Air China purchased a total of 268,000 tonnes of jet fuel at an average price of RMB7,654 per tonne, a year-over-year surge of 35%. The average jet fuel purchase price at international airports was RMB6,914 per tonne, and the average purchase price of jet fuel for international flights at the top six Chinese airports was RMB7,205 per tonne, representing steep increases of 40% and 33% year-over-year, respectively. The average jet fuel purchase price for domestic flights was RMB8,090 per tonne, a rise of 34% compared with June last year.

In June, the company made the following adjustments to jet fuel surcharges:

Effective Date
(Based on
Ticket Issue Date)

Route

Previous Rate

(Per Head Per

Sector)

New Rate

(Per Head Per

Sector)

1 June

Mainland China to Hong Kong

RMB 187

RMB 198

Hong Kong to Mainland China

HKD222

HKD236

Mainland China to Japan

RMB 190

RMB 370

Japan to Mainland China

Yen 2500

Yen 4500

(Excluding Mainland China/ Japan) to Japan

USD 26

USD 55

The Philippines to Mainland China

RMB 310

RMB 400

Thailand to Mainland China

RMB 400

RMB 450

Indonesia to Mainland China

RMB 350

Vietnam to Mainland China

RMB 310

RMB 400

Myanmar to Mainland China

RMB 350

Pakistan to Mainland China

RMB 250

RMB 300

Nepal to Chengdu

RMB 310

RMB 360

UAE to Mainland China

RMB 420

RMB 450

Australia to Mainland China

AUD90

AUD105

Europe(Excluding UK, Russia, Turkey)to Mainland China

EUR 110 (France EUR 105)

EUR 120

During the month, the company added one B737-800 aircraft, one A320 aircraft and one business jet, while retiring one B737-300 aircraft. As of the end of June, Air China operated a fleet of 292 aircraft.

* Please note that Shenzhen Airlines and Air Macau are excluded from the above figures