Air China books 50% 1H profit

Air China’s first-half profit increased by 50% year-on-year due to lower fuel costs and higher travel demand in 2009, the South China Morning Post reported. The exact first half figure was not given, but Citigroup estimated it at US$229.8 million. Last year, the airline reported a US$187.3 million first-half profit under Chinese accounting standards. A 56.7% increase in oil prices between the end of 2008 and June 2009 also helped to reduce paper losses on hedging contracts. Air China booked a US$5.85 million gain on hedging contracts during the first quarter, and Citigroup estimates that the hedging gain for the first half could reach US$175.6 million. The expected resumption of a jet fuel surcharge on ticket prices is also expected to offset the airline’s fuel charges.