REG - Air China Ld - ANNOUNCEMENT ON IMPAIRMEN PROVISION

Air ChinaAnnouncement

Yesterday 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260327:nRSa4255Ya&default-theme=true

RNS Number : 4255Y  Air China Ld  27 March 2026

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong
Limited take no responsibility for the contents of this announcement, make no
representation as to its accuracy or completeness and expressly disclaim any
liability whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this announcement.

 

中國國際航空股份有限公司

AIR CHINA LIMITED

(a joint stock limited company incorporated in the People's Republic of China
with limited liability)

(Stock Code: 00753)

 

ANNOUNCEMENT REGARDING PROVISION FOR IMPAIRMENT FOR 2025

 

After considered and approved by the Audit and Risk Management Committee (the
Supervisory Committee) of the seventh session of the board of directors (the
"Board") of Air China Limited (the "Company"), the Company held the fourteenth
meeting of the seventh session of the Board on 26 March 2026, at which the
Board considered and approved the "Resolution on Provision for Impairment for
2025", agreeing to make appropriate provisions for asset impairment by the
Company based on its actual condition.

 

1.       OVERVIEW OF THE PROVISION FOR IMPAIRMENT

 

In accordance with the Accounting Standards for Business Enterprisesand the
requirements of the Company's relevant accounting policies and accounting
estimates, and in order to present an objective and fair view of the Company's
financial position and operating results for 2025, the Company conducted an
assessment of expected credit losses on the relevant assets and performed
impairment tests on assets that may have shown indicators of impairment. Based
on the test results, the Company recognised a total of RMB575 million in
provisions for various asset impairments for 2025, with the specific details
as follows:

 

 

Unit: RMB'000

 Item                             Provision made   Remarks
                                  For 2025

 Provision for asset impairment   586,113          Impairment provision made for fixed assets, goodwill and inventories

 Provision for credit impairment  -10,695          Impairment provisions made for accounts receivable, other receivables, other
                                                   debt investments, other current assets, etc.
 Total                            575,418          -

 

 

2.       SPECIFIC DETAILS OF THE PROVISIONS FOR IMPAIRMENT

 

A.      Provision for Asset Impairment

 

I.       Fixed Assets

 

In accordance with Accounting Standards for Business Enterprises No. 8 - Asset
Impairment, the Company conducted an impairment test on aircraft approaching
retirement and recognised a provision for fixed asset impairment in the amount
of RMB96 million for the shortfall between the assets' recoverable amount and
their carrying value.

 

II.      Goodwill

 

In accordance with Accounting Standards for Business Enterprises No. 8 - Asset
Impairment, the Company conducted an impairment test on asset group which
contains goodwill. The recoverable amount shall be determined according to the
present value of the expected future cash flow of the asset group, and the
future cash flow shall be based on the five-year cash flow forecast approved
by the management. According to the test result, the Company recognised a
provision for goodwill impairment in the amount of RMB484 million for the
shortfall between the recoverable amount of the asset group of Shandong
Aviation Group Corporation and its carrying amount.

 

III.    Inventories

 

In accordance with Accounting Standards for Business Enterprises No. 1 -
Inventories, the Company measured inventories at the lower of cost or net
realisable value and recognised a provision for inventory write-down of RMB6
million for the shortfall between net realisable value and cost.

 

B.      Provision for Credit Impairment

 

In accordance with Accounting Standards for Business Enterprises No. 22 -
Recognition and Measurement of Financial Instruments, the Company, based on
the expected credit losses, recognised impairment provisions in the amount of
RMB-11 million for accounts receivable, other receivables, other debt
investments, other current assets, etc.

 

3.       IMPACT OF THE PROVISION FOR IMPAIRMENT ON THE COMPANY'S FINANCIAL POSITION

 

For 2025, the Company recognised a total of RMB575 million in provisions for
various asset impairments in its consolidated financial statements. After
considering the comprehensive impact of factors such as the reversal of
impairments during the year, loss before taxation in the Company's
consolidated financial statements increased by RMB567 million. The provisions
for impairment comply with the Accounting Standards for Business
Enterprisesand the requirements of the Company's relevant accounting policies
and accounting estimates, providing a true and objective reflection of the
Company's financial position and operating results for the year of 2025 and
accurately representing the actual condition of the Company's assets.

 

By Order of the Board

Air China Limited

Xiao Feng

Company Secretary

 

Beijing, the PRC, 26 March 2026

 

As at the date of this announcement, the directors of the Company are Mr. Liu
Tiexiang, Mr. Qu Guangji, Mr. Cui Xiaofeng, Mr. Patrick Healy, Mr. Xiao Peng,
Mr. Xu Niansha*, Mr. He Yun*, Ms. Winnie Tam Wan-chi* and Mr. Gao Chunlei*.

 

*    Independent non-executive director of the Company

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  STRFZGZFDNKGVZG



            Copyright 2019 Regulatory News Service, all rights reserved