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HONG KONG: Mainland flag carrier Air China announced Tuesday an 11.7 per cent rise in 2006 net profit to 2.7 billion yuan (US$347m) as increased passenger traffic offset the impact of higher jet fuel prices.
Operating revenue grew 17.4 per cent to 44.9 billion yuan, while total expenses rose 22.5 per cent to 42.4 billion yuan due to increases in the price and consumption of jet fuel.
However, the airline said easier oil prices in the second half of the year brought some relief.
"2006 was a critical year for the company," said company chairman Li Jiaxiang, highlighting its A-share listing in Shanghai which had helped raise the funds used for the company to expand its fleet by 31 aircraft.
Air China said it carried 33.97 million passengers in 2006, up 14.2 per cent, giving a passenger load factor, a measure of how full its flights were, up 1.9 percentage points to 75.9 per cent.
During the year, the company introduced 35 new routes and began new international services including flights from Beijing to Ho Chi Ming city, Delhi, Madrid and Sao Palo.
Looking forward, Li was optimistic.
"Although the high price of jet fuel creates significant cost a pressure, (China's) economy has maintained its fast pace of growth and has been the driving force behind our rapid growth," he said.
He said he expected the 2008 Olympic Games in Beijing to boost the airline's business opportunities.
- AFP/yy
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