REG - Air China Ld - INTERIM RESULTS FOR SIX MONTHS ENDED 30 JUNE 2024
30/08/2024 07:00
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RNS Number : 2946C Air China Ld 30 August 2024
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Limited take no responsibility for the contents of this announcement, make no
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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)
INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2024
The Board of the Company has approved, among others, the unaudited interim
results of the Group for the six months ended 30 June 2024 at a meeting of the
Board held on 29 August 2024.
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2024
The Board presents the unaudited interim results of the Group for the six
months ended 30 June 2024 as follows:
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE SIX MONTHS ENDED 30 JUNE 2024
Six months ended 30 June
NOTES 2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Revenue 3A 79,520,332 59,613,193
Other income and gains 4 3,250,850 4,069,876
82,771,182 63,683,069
Operating expenses
Jet fuel costs (27,132,269) (19,346,786)
Employee compensation costs (16,953,921) (13,594,872)
Depreciation and amortisation (14,025,285) (12,704,783)
Take-off, landing and depot charges (9,963,482) (6,635,703)
Aircraft maintenance, repair and overhaul costs (6,862,447) (4,972,590)
Air catering charges (1,973,435) (1,167,220)
Aircraft and engine lease expenses (261,132) (146,086)
Other lease expenses (346,900) (242,637)
Other flight operation expenses (3,263,760) (3,419,424)
Selling and marketing expenses (2,275,875) (1,542,326)
General and administrative expenses (780,314) (706,174)
Impairment loss recognised on non-current assets - (91,160)
Net impairment loss recognised under expected credit loss model (14,334) (11,508)
(83,853,154) (64,581,269)
Loss from operations 5 (1,081,972) (898,200)
Finance income 245,615 291,375
Finance costs 6 (3,265,473) (3,542,402)
Share of results of associates 1,084,817 1,265,560
Share of results of joint ventures 91,360 88,817
Exchange losses, net (360,422) (1,565,320)
Loss before taxation (3,286,075) (4,360,170)
Income tax (expense)/credit 7 (252,536) 316,216
Loss for the period (3,538,611) (4,043,954)
Attributable to:
- Equity shareholders of the Company (2,778,953) (3,446,814)
- Non-controlling interests (759,658) (597,140)
(3,538,611) (4,043,954)
Loss per share
- Basic and diluted 9 RMB(17.67) cents RMB(22.39) cents
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2024
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Loss for the period (3,538,611) (4,043,954)
Other comprehensive (expense)/income for the period
Items that will not be reclassified to profit or loss:
- Fair value losses on investments in equity instruments at fair value through (86,078) (67,769)
other comprehensive income
- Remeasurement of net defined benefit liability (5,741) 44
- Share of other comprehensive expense of an associate (361) -
- Income tax credit relating to items that will not be reclassified to profit 21,519 16,942
or loss
Items that may be reclassified subsequently to profit or loss:
- Fair value gains on investments in debt instruments at fair value through 14,619 5,530
other comprehensive income
- Share of other comprehensive income/(expense) of associates and joint 232,792 (474,687)
ventures
- Exchange differences on translation of foreign operations 137,205 561,877
- Impairment loss recognised on investments in debt instruments at fair value (236) (2,505)
through other comprehensive income
- Income tax expense relating to items that may be reclassified subsequently (3,597) (756)
to profit or loss, net
Other comprehensive income for the period, net of tax 310,122 38,676
Total comprehensive expense for the period (3,228,489) (4,005,278)
Attributable to:
- Equity shareholders of the Company (2,433,924) (3,389,356)
- Non-controlling interests (794,565) (615,922)
(3,228,489) (4,005,278)
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2024
At At
30 June 31 December
NOTE 2024 2023
RMB'000 RMB'000
(Unaudited) (Audited)
Non-current assets
Property, plant and equipment 119,636,097 117,728,498
Right-of-use assets 118,740,307 120,971,059
Investment properties 709,827 726,594
Intangible assets 106,576 106,580
Goodwill 4,095,732 4,095,732
Interests in associates 13,520,651 12,863,023
Interests in joint ventures 2,566,091 2,413,799
Advance payments for aircraft and flight equipment 25,129,965 26,114,064
Deposits for aircraft under leases 535,239 525,463
Equity instruments at fair value through other comprehensive income 1,821,908 1,547,986
Debt instruments at fair value through other 1,311,348 1,397,310
comprehensive income
Deferred tax assets 13,704,304 13,757,180
Other non-current assets 627,191 696,685
302,505,236 302,943,973
Current assets
Inventories 4,853,666 3,682,821
Accounts receivable 10 5,478,674 3,182,797
Bills receivable 6,203 3,601
Prepayments, deposits and other receivables 5,253,415 5,852,345
Financial assets at fair value through profit or loss 2,125 2,505
Restricted bank deposits 2,409,176 611,692
Cash and cash equivalents 19,963,866 15,016,804
Assets held for sale 107,359 108,527
Other current assets 4,820,628 3,873,629
42,895,112 32,334,721
Total assets 345,400,348 335,278,694
At At
30 June 31 December
NOTE 2024 2023
RMB'000 RMB'000
(Unaudited) (Audited)
Current liabilities
Air traffic liabilities (10,648,694) (8,366,222)
Accounts payable 11 (22,020,724) (17,954,298)
Bills payable (102,727) (500,160)
Dividends payable (99,856) (98,000)
Other payables and accruals (17,009,346) (15,701,546)
Current taxation (187,243) (76,662)
Lease liabilities (17,618,030) (18,175,349)
Interest-bearing borrowings (72,150,988) (47,271,768)
Provision for return condition checks (224,318) (650,777)
Contract liabilities (1,270,386) (1,522,492)
(141,332,312) (110,317,274)
Net current liabilities (98,437,200) (77,982,553)
Total assets less current liabilities 204,068,036 224,961,420
Non-current liabilities
Lease liabilities (61,803,418) (64,053,967)
Interest-bearing borrowings (86,162,955) (104,759,631)
Provision for return condition checks (18,402,780) (17,196,982)
Provision for early retirement benefit obligations (546) (720)
Long-term payables (764,985) (1,082,301)
Contract liabilities (2,143,187) (1,663,987)
Defined benefit obligations (185,489) (187,810)
Deferred income (428,738) (404,103)
Deferred tax liabilities (327,262) (347,910)
(170,219,360) (189,697,411)
NET ASSETS 33,848,676 35,264,009
CAPITAL AND RESERVES
Issued capital 16,593,720 16,200,793
Treasury shares (3,047,564) (3,047,564)
Reserves 23,041,654 24,052,746
Total equity attributable to equity shareholders of the Company 36,587,810 37,205,975
Non-controlling interests (2,739,134) (1,941,966)
TOTAL EQUITY 33,848,676 35,264,009
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2024
1. BASIS OF PREPARATION
The condensed consolidated financial statements for the six months ended 30
June 2024 have been prepared in accordance with International Accounting
Standard 34 "Interim Financial Reporting" ("IAS 34") issued by the
International Accounting Standards Board (the "IASB") as well as the
applicable disclosure requirements of the Listing Rule. The condensed
consolidated financial statements do not include all the information and
disclosures required in the annual consolidated financial statements, and
should be read in conjunction with the Group's consolidated financial
statements for the year ended 31 December 2023.
As at 30 June 2024, the Group's current liabilities exceeded its current
assets by approximately RMB98,437 million. The liquidity of the Group is
primarily dependent on its ability to maintain cash inflows from operations
and sufficient financing to meet its financial obligations as and when they
fall due. Considering the Company's sources of liquidity and the unutilised
bank facilities of RMB137,665 million as at 30 June 2024, the Directors
believe that adequate funding is available to fulfil the Group's debt
obligations and capital expenditure requirements to enable the Group to
continue in operational existence for the foreseeable future when preparing
these condensed consolidated financial statements for the six months ended 30
June 2024. Accordingly, these condensed consolidated financial statements have
been prepared on a basis that the Group will be able to continue as a going
concern.
2. PRINCIPAL ACCOUNTING POLICIES
The condensed consolidated financial statements have been prepared on the
historical cost basis except for certain financial instruments, which are
measured at fair values.
Other than change in accounting policies resulting from application of
amendments to IFRSs, the accounting policies and methods of computation used
in the condensed consolidated financial statements for the six months ended 30
June 2024 are the same as those presented in the Group's annual consolidated
financial statements for the year ended 31 December 2023.
Application of amendments to IFRSs
In the current interim period, the Group has applied the following amendments
to IFRSs issued by the IASB, for the first time, which are mandatorily
effective for the Group's annual period beginning on
1 January 2024 for the preparation of the Group's condensed consolidated
financial statements:
Amendments to IFRS 16 Lease Liability in a Sale and Leaseback
Amendments to IAS 1 Classification of Liabilities as Current or Non-current
Amendments to IAS 1 Non-current Liabilities with Covenants
Amendments to IAS 7 and IFRS 7 Supplier Finance Arrangements
The application of the amendments to IFRSs in the current interim period has
had no material impact on the Group's financial positions and performance for
the current and prior periods and/or on the disclosures set out in these
condensed consolidated financial statements.
3A. REVENUE
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Revenue from contracts with customers 79,406,709 59,482,882
Rental income (included in revenue of airline operations segment) 113,623 130,311
Total revenue 79,520,332 59,613,193
Disaggregation of revenue from contracts with customers
Six months ended 30 June 2024 Six months ended 30 June 2023
Segments Airline operations Other operations Airline operations Other operations
RMB'000 RMB'000 RMB'000 RMB'000
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Type of goods or services
Airline operations
Passenger 73,137,116 - 55,469,530 -
Cargo and mail 3,328,452 - 1,409,862 -
Others 859,569 - 695,501 -
77,325,137 - 57,574,893 -
Other operations
Aircraft engineering income - 2,023,821 - 1,872,556
Others - 57,751 - 35,433
- 2,081,572 - 1,907,989
Total 77,325,137 2,081,572 57,574,893 1,907,989
Geographical markets
Mainland China 55,765,478 2,081,572 48,304,525 1,907,989
Hong Kong Special Administrative Region ("SAR"), Macau SAR and Taiwan, China 2,484,032 - 1,730,660 -
International 19,075,627 - 7,539,708 -
Total 77,325,137 2,081,572 57,574,893 1,907,989
3B. SEGMENT INFORMATION
The Group's operating businesses are structured and managed separately,
according to the nature of their operations and the services they provide. The
Group has the following reportable operating segments:
(a) the "airline operations" segment which mainly comprises the
provision of air passenger and air cargo services; and
(b) the "other operations" segment which comprises the provision of
aircraft engineering and other airline-related services.
Inter-segment sales and transfers are transacted with reference to the selling
prices used for sales made to third parties at the then prevailing market
prices.
Operating segments
The following tables present the Group's consolidated revenue and loss before
taxation regarding the Group's operating segments in accordance with the CASs
for the six months ended 30 June 2024 and 2023 and the reconciliations of
reportable segment revenue and loss before taxation to the Group's
consolidated amounts under IFRSs:
For the six months ended 30 June 2024 (Unaudited)
Airline operations Other operations Elimination Total
RMB'000 RMB'000 RMB'000 RMB'000
Revenue
Sales to external customers 77,438,760 2,081,572 - 79,520,332
Inter-segment sales 106,388 4,343,972 (4,450,360) -
Revenue for reportable segments under CASs and IFRSs 77,545,148 6,425,544 (4,450,360) 79,520,332
Segment (loss)/profit before taxation
(Loss)/profit before taxation for reportable segments under CASs (3,715,694) 502,625 (77,722) (3,290,791)
Effect of differences between IFRSs and CASs 4,716
Loss before taxation for the period under IFRSs (3,286,075)
For the six months ended 30 June 2023 (Unaudited)
Airline operations Other operations Elimination Total
RMB'000 RMB'000 RMB'000 RMB'000
Revenue
Sales to external customers 57,705,204 1,907,989 - 59,613,193
Inter-segment sales 62,176 3,359,869 (3,422,045) -
Revenue for reportable segments under CASs and IFRSs 57,767,380 5,267,858 (3,422,045) 59,613,193
Segment (loss)/profit before taxation
(Loss)/profit before taxation for reportable segments under CASs (4,584,441) 263,523 (44,471) (4,365,389)
Effect of differences between IFRSs and CASs 5,219
Loss before taxation for the period under IFRSs (4,360,170)
The following table presents the segment assets of the Group's operating
segments under CASs as at 30 June 2024 and 31 December 2023, and the
reconciliations of reportable segment assets to the Group's consolidated
amounts under IFRSs:
Airline operations Other operations Elimination Total
RMB'000 RMB'000 RMB'000 RMB'000
Segment assets
Total assets for reportable segments as at 30 June 2024 under CASs (unaudited) 330,660,668 36,776,800 (22,016,670) 345,420,798
Effect of differences between IFRSs and CASs (20,450)
Total assets as at 30 June 2024 under IFRSs (unaudited) 345,400,348
Total assets for reportable segments as at 31 December 2023 under CASs 323,324,926 30,250,454 (18,272,699) 335,302,681
(audited)
Effect of differences between IFRSs and CASs (23,987)
Total assets as at 31 December 2023 under IFRSs (audited) 335,278,694
Geographical information
The following tables present the Group's consolidated revenue under IFRSs by
geographical location for the six months ended 30 June 2024 and 2023,
respectively:
For the six months ended 30 June 2024 (Unaudited)
Mainland Hong Kong SAR, Macau SAR and International Total
China Taiwan, China
RMB'000 RMB'000 RMB'000 RMB'000
Sales to external customers and 57,960,673 2,484,032 19,075,627 79,520,332
total revenue
For the six months ended 30 June 2023 (Unaudited)
Mainland Hong Kong SAR, Macau SAR and Taiwan, China International Total
China
RMB'000 RMB'000 RMB'000 RMB'000
Sales to external customers and total revenue 50,342,825 1,730,660 7,539,708 59,613,193
In determining the Group's geographical information, revenue is attributed to
the segments based on the origin or destination of each flight. Assets, which
consist principally of aircraft and ground equipment, supporting the Group's
worldwide transportation network, are mainly registered/located in Mainland
China. According to the business demand, the Group needs to flexibly allocate
different aircraft to match the need of the route network. An analysis of the
assets of the Group by geographical distribution has therefore not been
included.
There was no individual customer that contributed 10% or more of the Group's
revenue, for both periods.
4. OTHER INCOME AND GAINS
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Co-operation routes income and subsidy income 2,232,415 1,985,078
Gains on disposal of property, plant and equipment and right-of-use assets 775,226 669,898
(Loss)/gains on disposal of assets held for sale (7,907) 18,519
Dividend income 5,935 9,557
Others 245,181 1,386,824
3,250,850 4,069,876
5. LOSS FROM OPERATIONS
The Group's loss from operations is arrived at after charging:
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Depreciation of property, plant and equipment 6,505,225 5,350,122
Depreciation of right-of-use assets 7,503,289 7,340,150
Depreciation of investment properties 16,767 14,511
Amortisation of intangible assets 4 -
6. FINANCE COSTS
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Interest on interest-bearing borrowings 2,215,565 1,988,148
Interest on lease liabilities 1,192,838 1,677,935
Imputed interest expenses on defined benefit obligations 2,628 3,188
3,411,031 3,669,271
Less: Interest capitalised (145,558) (126,869)
3,265,473 3,542,402
The interest capitalisation rates during the period ranged from 2.40% to 4.45%
(six months ended 30 June 2023: 2.50% to 3.06%) per annum relating to the
costs of related borrowings during the period.
7. INCOME TAX CREDIT/(EXPENSE)
Six months ended 30 June
2024 2023
RMB'000 RMB'000
(Unaudited) (Unaudited)
Current income tax:
- Mainland China 201,017 126,521
- Hong Kong SAR and Macau SAR, China 887 833
Under provision in respect of prior years 431 11,920
Deferred tax 50,201 (455,490)
252,536 (316,216)
Under the Law of the PRC on Enterprise Income Tax (the "EIT Law") and
Implementation Regulation of the EIT Law, except for three (six months ended
30 June 2023: three) branches and five (six months ended 30 June 2023: five)
subsidiaries of the Company, and certain branches of two subsidiaries of the
Company which are taxed at a preferential rate of 15%, all group companies
located in Mainland China are subject to a income tax rate of 25% (six months
ended 30 June 2023: 25%). Subsidiaries in Hong Kong SAR, China are taxed at
profits tax rate of 16.5%, and subsidiaries in Macau SAR, China are taxed at
profits tax rate of 12%, for both periods.
In respect of majority of the Group's overseas airline activities, the Group
has either obtained exemptions from overseas taxation pursuant to the
bilateral aviation agreements between the overseas governments and the PRC
government, or has sustained tax losses in these overseas jurisdictions.
Accordingly, no provision for overseas tax has been made for overseas airlines
activities in the current and prior periods.
8. DIVIDENDS
(a) Dividends payable to equity shareholders attributable to the
interim period
In accordance with the Company's articles of association, the profit after tax
of the Company for the purpose of dividend distribution is based on the lesser
of (i) the profit determined in accordance with CASs; and (ii) the profit
determined in accordance with IFRSs.
No interim dividend has been declared by the Directors for the six months
ended 30 June 2024 (six months ended 30 June 2023: Nil).
(b) Dividends payable to equity shareholders attributable to the
previous financial year, approved during the current interim period
No dividend has been declared by the Directors for the financial year of 2023
during the six months ended 30 June 2024 (six months ended 30 June 2023: Nil).
9. LOSS PER SHARE
The calculation of the basic loss per share is based on the loss attributable
to ordinary equity shareholders of the Company of RMB2,779 million (six months
ended 30 June 2023: RMB3,447 million) and the weighted average number of
15,723,985,056 (six months ended 30 June 2023: 15,392,419,484) ordinary shares
in issue during the period, as adjusted to reflect the number of treasury
shares held by Cathay Pacific through reciprocal shareholding.
The Group had no potential ordinary shares in issue during both periods.
10. ACCOUNTS RECEIVABLE
The ageing analysis of the accounts receivable as at the end of the reporting
period, based on the transaction date, net of allowance for expected credit
losses, was as follows:
At At
30 June 31 December
2024 2023
RMB'000 RMB'000
(Unaudited) (Audited)
Within 30 days 4,116,692 2,349,927
31 to 60 days 628,333 265,953
61 to 90 days 192,085 155,337
Over 90 days 541,564 411,580
5,478,674 3,182,797
11. ACCOUNTS PAYABLE
The ageing analysis of the accounts payable, based on the transaction date, as
at the end of the reporting period was as follows:
At At
30 June 31 December
2024 2023
RMB'000 RMB'000
(Unaudited) (Audited)
Within 30 days 9,767,376 7,517,749
31 to 60 days 2,918,389 2,479,368
61 to 90 days 3,482,204 3,411,397
Over 90 days 5,852,755 4,545,784
22,020,724 17,954,298
SUMMARY OF OPERATING DATA
The following is the operating data summary of the Company, Shenzhen Airlines
(including Kunming Airlines), Shandong Airlines, Air Macau, Beijing Airlines,
Dalian Airlines and Air China Inner Mongolia.
January to June 2024 January to Increase/(decrease)
June 2023
Capacity
ASK (million) 171,790.89 128,799.56 33.38%
International 44,082.60 14,201.46 210.41%
Mainland China 122,675.40 111,479.91 10.04%
Hong Kong SAR, Macau SAR and Taiwan, China 5,032.90 3,118.19 61.40%
AFTK (million) 6,122.03 4,090.64 49.66%
International 2,577.25 925.60 178.44%
Mainland China 3,409.83 3,078.23 10.77%
Hong Kong SAR, Macau SAR and Taiwan, China 134.96 86.79 55.50%
ATK (million) 21,606.69 15,697.06 37.65%
Traffic
RPK (million) 136,213.57 90,835.35 49.96%
International 33,625.02 8,652.06 288.64%
Mainland China 98,966.23 80,191.99 23.41%
Hong Kong SAR, Macau SAR and Taiwan, China 3,622.31 1,991.29 81.91%
RFTK (million) 2,237.13 1,088.96 105.44%
International 1,409.88 497.15 183.59%
Mainland China 795.51 575.51 38.23%
Hong Kong SAR, Macau SAR and Taiwan, China 31.74 16.31 94.63%
Passengers carried (thousand) 74,959.47 55,544.89 34.95%
International 7,535.97 1,740.62 332.95%
Mainland China 65,161.14 52,566.97 23.96%
Hong Kong SAR, Macau SAR and Taiwan, China 2,262.37 1,237.31 82.85%
Cargo and mail carried (tonnes) 701,598.29 429,444.60 63.37%
Kilometres flown (million) 896.88 705.70 27.09%
Block hours (thousand) 1,438.31 1,151.46 24.91%
Number of flights 498,613 417,396 19.46%
International 47,201 13,715 244.16%
Mainland China 434,608 393,420 10.47%
Hong Kong SAR, Macau SAR and Taiwan, China 16,804 10,261 63.77%
RTK (million) 14,229.30 9,128.30 55.88%
Load factor
Passenger load factor (RPK/ASK) 79.29% 70.52% 8.77 ppt
International 76.28% 60.92% 15.35 ppt
Mainland China 80.67% 71.93% 8.74 ppt
Hong Kong SAR, Macau SAR and Taiwan, China 71.97% 63.86% 8.11 ppt
Cargo and mail load factor (RFTK/AFTK) 36.54% 26.62% 9.92 ppt
International 54.70% 53.71% 0.99 ppt
Mainland China 23.33% 18.70% 4.63 ppt
Hong Kong SAR, Macau SAR and Taiwan, China 23.52% 18.79% 4.73 ppt
Overall load factor (RTK/ATK) 65.86% 58.15% 7.70 ppt
Utilisation
Daily utilisation of aircraft 8.79 7.75 1.04 hours
(block hours per day per aircraft)
Yield
Yield per RPK (RMB) 0.5369 0.6107 (12.08%)
International 0.4927 0.7772 (36.61%)
Mainland China 0.5475 0.5873 (6.78%)
Hong Kong SAR, Macau SAR and Taiwan, China 0.6578 0.8275 (20.51%)
Yield per RFTK (RMB) 1.4878 1.2947 14.91%
International 1.7792 1.6404 8.46%
Mainland China 0.9035 0.8886 1.68%
Hong Kong SAR, Macau SAR and Taiwan, China 3.1906 5.0857 (37.26%)
Unit cost
Cost of operation per ASK (RMB) 0.4881 0.5014 (2.65%)
Cost of operation per ATK (RMB) 3.8809 4.1142 (5.67%)
DEVELOPMENT OF FLEET
During the Reporting Period, the Group introduced a total of 16 aircraft,
including three A321NEO aircraft, one A320NEO aircraft, nine B737 series
aircraft and three ARJ21-700 aircraft, and phased out a total of 6 aircraft,
including one A330-200 aircraft, four A320 aircraft and one B737 series
aircraft. As at the end of the Reporting Period, the Group had a total of 915
aircraft with an average age of 9.64 years, of which the Company operated a
fleet of 496 aircraft in total, with an average age of 9.38 years. The Company
introduced 9 aircraft and phased out 8 aircraft during the Reporting Period.
Details of the fleet of the Group are set out in the table below:
30 June 2024
Sub-total Self-owned Finance leases Operating leases Average age (year)
Airbus 437 199 119 119 9.29
A320 351 165 94 92 9.47
A330 56 24 5 27 11.48
A350 30 10 20 - 3.13
Boeing 447 192 81 174 10.46
B737 395 157 72 166 10.48
B747 10 8 2 - 14.97
B777 28 15 7 6 10.21
B787 14 12 - 2 7.36
COMAC 27 15 12 - 1.66
ARJ21 27 15 12 - 1.66
Business jets 4 1 - 3 10.78
Total 915 407 212 296 9.64
Introduction Plan Phase-out Plan
2024 2025 2026 2024 2025 2026
Airbus 4 26 33 13 6 11
A320 4 26 33 8 4 11
A330 - - - 5 2 -
Boeing 32 2 33 1 - 1
B737 32 - 23 1 - 1
B787 - 2 10 - - -
COMAC 12 12 10 - - -
ARJ21 9 2 - - - -
C919 3 10 10 - - -
Total 48 40 76 14 6 12
Note: Please refer to the actual operation for the introduction and phase-out
of the Group's fleet in the future.
BUSINESS OVERVIEW
Safe Operation
The Group is committed to implementing the comprehensive national security
concept and embracing a "General Safety" mindset. During the Reporting Period,
the Group meticulously addressed safety production-related rectifications
following central inspections, and successfully meeting the "halfway through
the year, more than halfway through the tasks" requirement. The Group actively
carried out a three-year action plan to tackle safety production at its root,
formulated an action implementation plan and advanced the work on schedule.
Major hidden safety hazards investigations and rectifications were thoroughly
conducted, with the Company's core management regularly leading teams to
supervise and inspect these efforts, ensuring strict adherence to dynamic
clearance. The Group continued to improve five major systems: safety
management, flight training, operation management, aircraft maintenance, risk
identification and hidden hazard investigation, accelerating its progress
toward becoming a world-class enterprise. Persisting with collaboration and
joint management across various sectors, the Group deepened its commitment to
building a strong safety culture and continuously improved employees' safety
awareness. By focusing on operational characteristics, the Group ensured
meticulous control of flight production and operations, optimizing flight
production management. During the Reporting Period, the Group recorded 1.438
million safe flight hours, and successfully completed key transport security
tasks, including the Spring Festival travel rush, the "Two Sessions" and
special charter flights, fully ensuring "two absolute safeties".
Maximising Operating Performance
The Group is making solid progress in enhancing quality and efficiency, with a
clear focus on achieving its annual business objectives. By leveraging the
domestic circulation, the Group has significantly increased fleet capacity in
the domestic market and meticulously developed domestic express routes to
enhance its competitive edges. On international routes, the Group continued to
promote the resumption of international flights and the opening of new routes,
steadily increased the fleet capacity to expand the scale of international
route operations and continuously improved the international fare product
system. Marketing strategies have been refined to seize opportunities for
yield growth, with a strong focus on enhancing yield quality. By implementing
scientific pricing for connecting flight products, the Group has increased
revenue from these services. Adjustments to the pricing structure for premium
cabins have ensured a steady improvement in the yield level from these
segments. The frequent flyer program has been optimized with a focus on
long-term customer value to increase member loyalty. The integration of
passenger and cargo services has been strengthened, leveraging the
supplementary capacity of passenger aircraft bellyhold to boost passenger
flight revenue. The Group advanced cost control, identified and leveraged
cost-saving opportunities, continually optimized labor costs, thereby
expanding the contribution to overall profitability. Unified management of
funds has been consistently reinforced, with enhanced debt risk management and
control and improved capital utilization efficiency, all while ensuring safety
of funds and reducing financial expenses.
Enhancing Services
The Group is committed to a people-centered development philosophy, with the
overarching goal of becoming a world-class air transport group. Focusing on
passenger needs, the Group continuously improves service standards and
quality, cultivates high-quality service product brands, and accelerates
service digitalization and upgrade. This commitment ensures that passengers
enjoy superior aviation services, thereby contributing to the high-quality
development of civil aviation services.
The Group is focused on addressing passengers' concerns by optimizing key
service standards, particularly for special passenger services and
compensation policies. Targeted improvements have been made in handling
irregular flights and ticketing services to enhance the overall passenger
experience. To strengthen its service brand, the Group has introduced cultural
initiatives such as the "Phoenix Pavilion" (「鳳庭薈」) exhibitions and
the "Dragon Boat Festival Themed Journey" (「情寄端午粽享旅途」),
further boosting passenger recognition of Air China's self-operated lounge
services. New express routes, including the "Chengdu-Shenzhen" express route
and the "Beijing-Guangzhou" Air China-Shenzhen Airlines joint express route,
have been launched to provide passengers with the ultimate "quick and
effortless travel" (「快人一步隨到隨走」) experience. The Group is
actively adapting to changing passenger needs by refining in-flight dining
standards and enhancing the user interface for in-flight entertainment.
Additionally, the Group has, developed a series of care products and
introduced proprietary boarding and disembarking music to further enrich the
in-flight product and service experience. Through the development of service
systems, the Group is driving the digital transformation of its services. This
includes accelerating the implementation of Air China's global ground flight
support platform, advancing the development of the full-process service
information notification system for passengers, building Air China's in-flight
catering reservation management system, and updating and iterating basic
service management systems such as the passenger service compensation system.
These initiatives are continuously enhancing the Group's digital service
capabilities.
Brand Value
The Group is making steady progress in brand leadership initiative,
contributing to the Company's high-quality development. Actively supporting
national strategies, the Group has utilized major exhibitions such as the
China Brand Expo (中國品牌博覽會), the Western China International Fair
for Investment and Trade (中國西部國際投資貿易洽談會) and the
China-Eurasia Expo (中國－亞歐博覽會) as platforms to showcase the
Company's commitment to social responsibility as a state-owned enterprise and
its role as a leader in product innovation. The Group also strengthened its
brand internationalization through collaborations with Star Alliance and
overseas industry associations, as well as theme flights on international
routes, aiming at enhancing Air China's global brand influence. According to
the World Brand Lab rankings, Air China ranked 25(th) on the 2024 list of
China's 500 Most Valuable Brands with a brand value of RMB259.695 billion,
representing a year-on-year increase of RMB24.533 billion. Both its ranking
and brand value remain a leading position in the domestic aviation service
industry.
Synergetic Development
Positioning itself at the new development stage, the Group has established a
clear development model focused on intensification, coordination, refinement
and risk prevention. By fully leveraging the deepened collaboration
mechanisms, the Group aims to enhance passenger service experiences, improve
efficiency and profitability, and strengthen competitive synergy. The Group
has outlined a coordinated approach and implementation path, formulated 32 key
tasks across three major sectors to advance comprehensive and in-depth
collaboration. The Group is particularly focused on deepening coordination in
key areas of passenger transportation to further solidify collaborative
outcomes. During the first half of the year, the Group strengthened the
integrated planning of Air China family airlines' route network, optimizing
the concentration of scattered external capacity towards hubs and main bases.
The Group also advanced the implementation of integrated interline operations
within the Air China family, resulting in a year-on-year increase of 216% in
the volume of interline flight segments. In addition, the Group gradually
achieved one-stop mutual ticket sales and streamlined refund and change
processes for flights of the Air China family airlines via mobile platforms,
thereby providing passengers with a more convenient service experience.
MANAGEMENT DISCUSSION AND ANALYSIS ON FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS
The following discussion and analysis are based on the Group's interim
condensed consolidated financial statements and notes thereto which were
prepared in accordance with the IAS 34 as well as the applicable disclosure
requirements under Appendix D2 to the Listing Rules and are designed to assist
the readers in further understanding the information provided in this
announcement so as to better understand the financial conditions and results
of operations of the Group as a whole.
Revenue
During the Reporting Period, the Group's revenue was RMB79,520 million,
representing a year-on-year increase of RMB19,907 million or 33.39%. Among the
revenues, air traffic revenue was RMB76,466 million, representing a
year-on-year increase of RMB19,586 million or 34.43%. Other operating revenue
was RMB3,054 million, representing a year-on-year increase of RMB321 million
or 11.74%.
Revenue Contributed by Geographical Segments
For the six months ended 30 June
2024 2023
(in RMB'000) Amount Percentage Amount Percentage Change
International 19,075,627 23.99% 7,539,708 12.65% 153.00%
Mainland China 57,960,673 72.89% 50,342,825 84.45% 15.13%
Hong Kong SAR, Macau SAR 2,484,032 3.12% 1,730,660 2.90% 43.53%
and Taiwan, China
Total 79,520,332 100.00% 59,613,193 100.00% 33.39%
Air Passenger Revenue
During the Reporting Period, the Group recorded an air passenger revenue of
RMB73,137 million, representing a year-on-year increase of RMB17,668 million.
Among the air passenger revenue, the increase of capacity resulted in an
increase in revenue of RMB18,515 million, and the increase of passenger load
factor resulted in an increase in revenue of RMB9,196 million, while the
decrease of passenger yield resulted in a decrease in revenue of RMB10,043
million. The capacity, passenger load factor and yield per RPK of air
passenger business during the Reporting Period are as follows:
For the six months ended 30 June
2024 2023 Change
Available seat kilometres (million) 171,790.89 128,799.56 33.38%
Passenger load factor (%) 79.29 70.52 8.77 ppt
Yield per RPK (RMB) 0.5369 0.6107 (12.08%)
Air Passenger Revenue Contributed by Geographical Segments
For the six months ended 30 June
2024 2023
(in RMB'000) Amount Percentage Amount Percentage Change
International 16,567,178 22.65% 6,724,163 12.12% 146.38%
Mainland China 54,187,183 74.09% 47,097,647 84.91% 15.05%
Hong Kong SAR, Macau SAR and Taiwan, China 2,382,755 3.26% 1,647,720 2.97% 44.61%
Total 73,137,116 100.00% 55,469,530 100.00% 31.85%
Air Cargo and Mail Revenue
During the Reporting Period, the Group's air cargo and mail revenue was
RMB3,328 million, representing a year-on-year increase of RMB1,919 million.
Among which, the increase of capacity resulted in an increase in revenue of
RMB700 million, and the increase of cargo and mail load factor resulted in an
increase in revenue of RMB786 million, while the increase of yield of cargo
and mail business contributed to an increase in revenue of RMB432 million. The
capacity, cargo and mail load factor and yield per RFTK of air cargo and mail
business during the Reporting Period are as follows:
For the six months ended 30 June
2024 2023 Change
Available freight tonne kilometres (million) 6,122.03 4,090.64 49.66%
Cargo and mail load factor (%) 36.54 26.62 9.92 ppt
Yield per RFTK (RMB) 1.4878 1.2947 14.91%
Air Cargo and Mail Revenue Contributed by Geographical Segments
For the six months ended 30 June
2024 2023
(in RMB'000) Amount Percentage Amount Percentage Change
International 2,508,449 75.36% 815,545 57.85% 207.58%
Mainland China 718,726 21.59% 511,377 36.27% 40.55%
Hong Kong SAR, Macau SAR 101,277 3.05% 82,940 5.88% 22.11%
and Taiwan, China
Total 3,328,452 100.00% 1,409,862 100.00% 136.08%
Operating Expenses
During the Reporting Period, the Group's operating expenses increased by
RMB19,272 million on a year-on-year basis to RMB83,853 million, representing
an increase of 29.84%. The breakdown of the operating expenses is set out
below:
For the six months ended 30 June
2024 2023
(in RMB'000) Amount Percentage Amount Percentage Change
Jet fuel costs 27,132,269 32.36% 19,346,786 29.96% 40.24%
Take-off, landing and depot charges 9,963,482 11.88% 6,635,703 10.27% 50.15%
Depreciation and amortisation 14,025,285 16.73% 12,704,783 19.67% 10.39%
Aircraft maintenance, repair and overhaul costs 6,862,447 8.18% 4,972,590 7.70% 38.01%
Employee compensation costs 16,953,921 20.22% 13,594,872 21.05% 24.71%
Air catering charges 1,973,435 2.35% 1,167,220 1.81% 69.07%
Selling and marketing expenses 2,275,875 2.71% 1,542,326 2.39% 47.56%
General and administrative expenses 780,314 0.93% 706,174 1.09% 10.50%
Others 3,886,126 4.64% 3,910,815 6.06% (0.63%)
Total 83,853,154 100.00% 64,581,269 100.00% 29.84%
• Jet fuel costs increased by RMB7,785 million on a
year-on-year basis, mainly due to the effect of the increase in the
consumption of jet fuel and increase in the prices of jet fuel.
• Take-off, landing and depot charges increased by RMB3,328
million on a year-on-year basis, mainly due to the year-on-year increase in
the number of take-offs and landings.
• Depreciation and amortisation increased by RMB1,321 million
on a year-on-year basis, mainly due to the expansion of fleet and the
year-on-year increase in flying hours.
• Aircraft maintenance, repair and overhaul costs increased by
RMB1,890 million on a year-on-year basis, mainly due to the year-on-year
increase in flying hours.
• Employee compensation costs increased by RMB3,359 million on
a year-on-year basis, mainly due to the inclusion of Shandong Aviation Group
Corporation in the consolidation scope since 21 March 2023 and the
year-on-year increase in flight hour fees.
• Air catering charges increased by RMB806 million on a
year-on-year basis, mainly due to the increase in the number of passengers.
• Selling and marketing expenses increased by RMB734 million
on a year-on-year basis, mainly due to the increase in handling fees for
agency services and booking fees resulting from the increase in the sales
volumes and the number of passengers.
• General and administrative expenses increased by RMB74
million on a year-on-year basis, mainly due to the effect of the inclusion of
Shandong Aviation Group Corporation in the consolidation scope since 21 March
2023.
• Other operating expenses mainly included civil aviation
development fund and ordinary expenses arising from the core air traffic
business other than those mentioned above, which decreased by RMB25 million on
a year-on-year basis, mainly due to the year-on-year decrease in impairment
loss recognised on long-term assets.
Net Exchange Loss and Finance Costs
During the Reporting Period, the Group recorded a net exchange loss of RMB360
million, representing a year-on-year decrease of RMB1,205 million. The Group
incurred finance costs of RMB3,265 million (excluding those capitalised)
during the Reporting Period, representing a year-on-year decrease of RMB277
million.
Share of Results of Associates and Joint Ventures
During the Reporting Period, the Group's share of profits of its associates
was RMB1,085 million, representing a year-on-year decrease of RMB181 million.
The Group recorded a share of profits of Cathay Pacific of RMB1,067 million
during the Reporting Period, representing a year-on-year decrease of RMB212
million.
During the Reporting Period, the Group's share of profits of its joint
ventures was RMB91 million, representing a year-on-year increase of RMB3
million.
Assets Structure Analysis
At the end of the Reporting Period, the total assets of the Group were
RMB345,400 million, representing an increase of 3.02% from that as at 31
December 2023. Among them, the current assets accounted for RMB42,895 million
or 12.42% of the total assets, while the non-current assets accounted for
RMB302,505 million or 87.58% of the total assets.
Among the current assets, cash and cash equivalents were RMB19,964 million,
representing an increase of 32.94% from that as at 31 December 2023, which was
mainly due to the Company's flexible adjustment of its funds according to its
capital arrangements.
Among the non-current assets, the aggregate carrying amount of property, plant
and equipment and right-of-use assets as at the end of the Reporting Period
was RMB238,376 million, representing a decrease of 0.14% from that as at 31
December 2023.
Asset Pledged
At the end of the Reporting Period, the Group's certain bank loans and finance
leasing agreements were secured by aircraft and buildings with an aggregate
book value of approximately RMB84,750 million (31 December 2023: RMB84,599
million) and land use rights with book value of approximately RMB24 million
(31 December 2023: RMB24 million). In addition, the Group had restricted bank
deposits of approximately RMB2,409 million (31 December 2023: approximately
RMB612 million), which were mainly statutory reserves deposited in the
People's Bank of China and time deposits with a maturity of more than 3
months.
Capital Expenditure
During the Reporting Period, the Group's capital expenditure amounted to a
total of RMB5,921 million, of which the total investment in aircraft and
engines was RMB4,047 million. Other capital expenditure investment amounted to
RMB1,874 million, mainly including investment in high-value rotables, flight
simulators, infrastructure construction, IT system construction, ground
equipment procurement and cash component of the long-term investments.
Equity Investment
At the end of the Reporting Period, the Group's equity investment in its
associates amounted to RMB13,521 million, representing an increase of 5.11%
from that as at 31 December 2023, among which, the balance of the equity
investment of the Group in Cathay Pacific amounted to RMB13,263 million.
At the end of the Reporting Period, the Group's equity investment in its joint
ventures was RMB2,566 million, representing an increase of 6.31% from that as
at 31 December 2023.
Debt Structure Analysis
At the end of the Reporting Period, the Group's total liabilities amounted to
RMB311,552 million, representing an increase of 3.85% from those as at 31
December 2023. Among them, current liabilities amounted to RMB141,332 million,
accounting for 45.36% of the total liabilities; and non-current liabilities
amounted to RMB170,220 million, accounting for 54.64% of the total
liabilities.
Among the current liabilities, interest-bearing debts (including
interest-bearing borrowings and lease liabilities) amounted to RMB89,769
million, representing an increase of 37.16% as compared with that as at 31
December 2023.
Among the non-current liabilities, interest-bearing debts (including
interest-bearing borrowings and lease liabilities) amounted to RMB147,966
million, representing a decrease of 12.35% from that as at 31 December 2023.
Details of interest-bearing liabilities of the Group by currency are set out
below:
30 June 2024 31 December 2023 Change
(in RMB'000) Amount Percentage Amount Percentage
RMB 202,359,124 85.12% 197,161,354 84.16% 2.64%
US dollars 34,356,310 14.45% 36,018,880 15.38% (4.62%)
Others 1,019,958 0.43% 1,080,481 0.46% (5.60%)
Total 237,735,392 100.00% 234,260,715 100.00% 1.48%
Commitments and Contingent Liabilities
The Group's capital commitments, which mainly consisted of the expenditure in
the next few years for purchasing certain aircraft and related equipment,
increased by 58.67% from RMB72,079 million as at 31 December 2023 to
RMB114,365 million as at the end of the Reporting Period. The Group's
investment commitments, which were mainly used for the investment agreements
that have been signed and come into effect, amounted to RMB310 million as at
the end of the Reporting Period, as compared with RMB457 million as at 31
December 2023.
Gearing Ratio
At the end of the Reporting Period, the Group's gearing ratio (total
liabilities divided by total assets) was 90.20%, representing an increase of
0.72 percentage points from that as at 31 December 2023.
Working Capital and its Sources
At the end of the Reporting Period, the Group's net current liabilities
(current liabilities less current assets) were RMB98,437 million, representing
an increase of RMB20,455 million from that as at 31 December 2023. The Group's
current ratio (current assets divided by current liabilities) was 0.30,
representing an increase of 0.01 as compared to that as at 31 December 2023.
The Group meets its working capital needs mainly through its operating
activities and external financing activities. During the Reporting Period, the
Group's net cash inflow from operating activities was RMB14,253 million,
representing a decrease of 11.70% from RMB16,142 million for the corresponding
period in 2023, which was mainly due to the effect of changes in operating
payable items. Net cash outflow from investing activities was RMB8,177
million, representing an increase of 302.52% from RMB2,032 million for the
corresponding period in 2023, mainly due to the consolidation of Shandong
Aviation Group Corporation into the Group for the corresponding period of the
previous year with the recognition of net cash inflow arising on acquisition
of a subsidiary of RMB5,392 million (presented as net cash inflow arising on
acquisition of a subsidiary). Net cash outflow from financing activities
amounted to RMB1,154 million, as compared to the cash inflow of RMB1,046
million for the corresponding period in 2023.
At the end of the Reporting Period, the Company has obtained bank facilities
of up to RMB230,587 million granted by several banks in the PRC, among which
approximately RMB92,922 million has been utilised and approximately RMB137,665
million remained unutilised. The remaining amount is sufficient to meet its
demands on liquidity and future capital commitments.
POTENTIAL RISKS
1. Risks of External Environment
Market Fluctuation
During the Reporting Period, the transportation production of civil aviation
resumed its natural growth. Leveraging the super large-scale domestic demand
market, the domestic aviation market achieved stable and relatively fast
growth. The international air passenger transportation market continued its
rapid recovery trend, with the number of passengers surpassing 80% of the same
period in 2019, while the resumption pace of the North American routes, the
traditional advantageous market of the Company, was slow. Based on the
characteristics of the new development stage, the Group will fully, precisely
and comprehensively implement the new development philosophy, proactively
support and integrate into the new development pattern, adhere to the focus on
domestic circulation and promote the rational allocation of resources, in a
bid to develop its core competitiveness in the market. Furthermore, the Group
will optimize and improve the international fleet capacity structure and
promote the opening and resumption of flights to "Belt and Road" partner
countries, and to accelerate the recovery of profitability.
Oil Price Fluctuation
Jet fuel is one of the main operating costs of the Group. The results of the
Group are relatively more affected by the changes in jet fuel price. During
the Reporting Period, with other variables remaining unchanged, if the average
price of the jet fuel rises or falls by 5%, the Group's jet fuel costs will
rise or fall by approximately RMB1.357 billion.
Exchange Rate Fluctuation
The Group's certain assets and liabilities are denominated in US dollar.
Certain international income and expenses of the Group are denominated in
currencies other than RMB. Assuming that the risk variables other than the
exchange rate stay unchanged, the appreciation or depreciation of RMB against
US dollar by 1% due to the changes in the exchange rate will result in the
increase or decrease in the Group's net profit and shareholders' equity as at
30 June 2024 by approximately RMB227 million.
2. Risks of Competition
Industry competition
During the Reporting Period, there was no significant reduction in the number
of operating entities in the market, hence the Company still faced relatively
huge industry competition pressure. In respect of the domestic market, as the
international market has not yet fully recovered, wide-body aircraft were used
in the domestic market, which intensified the imbalance between supply and
demand in the domestic market. In respect of the international market, the
newly resumed and increased routes of domestic airlines were mainly
concentrated in destinations such as Europe, Central Asia and the Middle East,
resulting in an intense competition in certain regions. Adhering to its
strategy for hub network, the Company spared no efforts in building Beijing
Capital International Airport into a world-class hub and Chengdu Tianfu
International Airport into an international hub, realising differentiated
development from other market competitors. Main routes and express routes were
launched centering on hubs as well as principal bases and markets with a view
to strengthening core market competitiveness with high-quality products.
Alternative competition
As the world's largest high-speed railway network further expanded, there are
ongoing risks relating to diversion of customers in terms of short- and
medium-distance transportation. In the long run, the high-speed railway will
change China's geographic pattern of the economy and, as a result of its
cooperation and competition with civil aviation, the air-rail interlink
operation will provide strong support to the development of aviation hubs. The
civil aviation sector will give full play to its comparative advantages in the
comprehensive transportation system and promote international exchanges. It
will "link main routes and branch routes and connect the whole network" to
offer easily accessible and quality transportation services to the general
public.
PURCHASES, SALES OR REDEMPTION OF LISTED SECURITIES
During the Reporting Period, neither the Company nor any of its subsidiaries
purchased, sold or redeemed any listed securities of the Company (including
the sales of treasury shares (as defined in the Listing Rules)) (the term
"securities" has the meaning ascribed to it under paragraph 1 of Appendix D2
to the Listing Rules).
INTERIM DIVIDEND
No interim dividend will be paid by the Company for the six months ended 30
June 2024.
SUBSEQUENT EVENTS
On 26 April 2024, upon approval by the 29th meeting of the sixth session of
the Board of the Company, the Company entered into an agreement with COMAC for
the purchase of 100 C919 aircraft from COMAC. The basic price, comprising
airframe price, add-on features price and engine price, in aggregate, is
approximately US$10,800 million. The purchase has been approved by the
shareholders at the 2024 second extraordinary general meeting of the Company
held on 9 August 2024. Please refer to the announcements of the Company dated
26 April 2024 and 9 August 2024 for details.
On 15 July 2024, the "Resolution in Relation to the Nomination of Mr. Cui
Xiaofeng as a Director" was considered and approved by the 31st meeting of the
sixth session of the Board of the Company. Upon the pre-review and approval by
the nomination committee of the Board of the Company, the Board agreed to
nominate Mr. Cui Xiaofeng as a candidate of non-executive Director of the
sixth session of the Board of the Company. On 9 August 2024, Mr. Cui Xiaofeng
was elected as a non-executive Director of the Company at the 2024 second
extraordinary general meeting of the Company. Please refer to the
announcements of the Company dated 15 July 2024 and 9 August 2024 for details.
CORPORATE GOVERNANCE
Compliance with the Corporate Governance Code
During the Reporting Period, the Company has complied with the code provisions
in Part 2 of the Corporate Governance Code as set out in Appendix C1 to the
Listing Rules.
Compliance with the Model Code
The Company has adopted and formulated a code of conduct on terms no less
stringent than the required standards of the Model Code. After making specific
enquiries, the Company confirmed that each Director and each Supervisor has
complied with the required standards of the Model Code and the Company's code
of conduct throughout the Reporting Period.
DISCLOSURE REQUIREMENTS UNDER THE LISTING RULES
In order to comply with the requirements under paragraph 46 of Appendix D2 to
the Listing Rules, the Company confirmed that save as disclosed in this
announcement, there are no material changes in the current information of the
Company in relation to matters as set out in paragraph 46(3) of Appendix D2 to
the Listing Rules as compared with relevant disclosures in the 2023 annual
report of the Company.
REVIEW BY THE AUDIT AND RISK CONTROL COMMITTEE (SUPERVISION COMMITTEE)
The audit and risk control committee (supervision committee) of the Company
has reviewed the Company's interim results for the six months ended 30 June
2024, the Company's unaudited interim condensed consolidated financial
statements, and the accounting policies and practices adopted by the Group.
GLOSSARY OF TECHNICAL TERMS
Capacity Measurements
"available tonne kilometres" or "ATK(s)" the number of tonnes of capacity available for transportation multiplied by
the kilometres flown
"available seat kilometres" or "ASK(s)" the number of seats available for sale multiplied by the kilometres flown
"available freight tonne kilometres" or "AFTK(s)" the number of tonnes of capacity available for the carriage of cargo and mail
multiplied by the kilometres flown
Traffic Measurements
"passenger traffic" measured in RPK, unless otherwise specified
"revenue passenger kilometres" or "RPK(s)" the number of revenue passengers carried multiplied by the kilometres flown
"cargo and mail traffic" measured in RFTK, unless otherwise specified
"revenue freight tonne kilometres" or "RFTK(s)" the revenue cargo and mail load in tonnes multiplied by the kilometres flown
"revenue tonne kilometres" the revenue load (passenger and cargo) in tonnes multiplied by the kilometres
or "RTK(s)" flown
Efficiency Measurements
"passenger load factor" RPK expressed as a percentage of ASK
"cargo and mail load factor" RFTK expressed as a percentage of AFTK
"overall load factor" RTK expressed as a percentage of ATK
"block hour" each whole and/or partial hour elapsing from the moment the chocks are removed
from the wheels of the aircraft for flights until the chocks are next again
returned to the wheels of the aircraft
Yield Measurements
"passenger yield"/"yield per RPK" revenues from passenger operations divided by RPKs
"cargo yield"/"yield per RFTK" revenues from cargo operations divided by RFTKs
DEFINITIONS
In this announcement, unless the context otherwise requires, the following
terms shall have the following meanings:
"Airbus" Airbus S.A.S., a company established in Toulouse, France
"Air China Inner Mongolia" Air China Inner Mongolia Co., Ltd., a non-wholly owned subsidiary of the
Company
"Air Macau" Air Macau Company Limited, a non-wholly owned subsidiary of the Company
"Ameco" Aircraft Maintenance and Engineering Corporation, a non-wholly owned
subsidiary of the Company
"Articles of Association" the articles of association of the Company, as amended from time to time
"A Share(s)" ordinary share(s) in the share capital of the Company, with a nominal value of
RMB1.00 each, which are subscribed for and traded in Renminbi and listed on
Shanghai Stock Exchange
"Beijing Airlines" Beijing Airlines Company Limited, a non-wholly owned subsidiary of the Company
"Board" the board of directors of the Company
"Boeing" The Boeing Company
"CASs" China Accounting Standards for Business Enterprises
"Cathay Pacific" Cathay Pacific Airways Limited, an associate of the Company
"CNAHC" China National Aviation Holding Corporation Limited
"COMAC" Commercial Aircraft Corporation of China, Ltd.
"Company", "We" or Air China Limited, a company incorporated in the PRC, whose H Shares are
"Air China" listed on the Hong Kong Stock Exchange as its primary listing venue and on the
Official List of the UK Listing Authority as its secondary listing venue, and
whose A Shares are listed on the Shanghai Stock Exchange
"Dalian Airlines" Dalian Airlines Company Limited, a non-wholly owned subsidiary of the Company
"Director(s)" the director(s) of the Company
"Group" the Company and its subsidiaries
"Hong Kong" the Hong Kong Special Administrative Region of the People's Republic of China
"Hong Kong Stock Exchange" The Stock Exchange of Hong Kong Limited
"H Share(s)" overseas-listed foreign invested share(s) in the share capital of the Company,
with a nominal value of RMB1.00 each, which is/are listed on the Hong Kong
Stock Exchange (as primary listing venue) and has/have been admitted into the
Official List of the UK Listing Authority (as secondary listing venue)
"International Financial Reporting Standards" or "IFRSs" International Financial Reporting Standards
"Kunming Airlines" Kunming Airlines Company Limited, a subsidiary of Shenzhen Airlines
"Listing Rules" The Rules Governing the Listing of Securities on The Stock Exchange of Hong
Kong Limited
"Model Code" the Model Code for Securities Transactions by Directors of Listed Issuers as
set out in Appendix C3 to the Listing Rules
"Reporting Period" the period from 1 January 2024 to 30 June 2024
"RMB" Renminbi, the lawful currency of the PRC
"SFO" The Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
"Shandong Airlines" Shandong Airlines Co., Ltd., a non-wholly owned subsidiary of the Shandong
Aviation Group Corporation
"Shandong Aviation Group Corporation" Shandong Aviation Group Company Limited, a non-wholly owned subsidiary of the
Company
"Shenzhen Airlines" Shenzhen Airlines Company Limited, a non-wholly owned subsidiary of the
Company
"Supervisor(s)" the supervisor(s) of the Company
"Supervisory Committee" the supervisory committee of the Company
"US dollars" United States dollars, the lawful currency of the United States
By Order of the Board
Air China Limited
Xiao Feng Huen Ho Yin
Joint Company Secretaries
Beijing, the PRC, 29 August 2024
As at the date of this announcement, the directors of the Company are Mr. Ma
Chongxian, Mr. Wang Mingyuan, Mr. Cui Xiaofeng, Mr. Patrick Healy, Mr. Xiao
Peng, Mr. Li Fushen*, Mr. He Yun*, Mr. Xu Junxin* and Ms. Winnie Tam Wan-chi*.
* Independent non-executive director of the Company
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