Profits at Chinese air carriers fall in Q3

Two of the mainland’s largest air carriers, Air China (AIRC.LON, 601111.SH, 0753.HKG) and China Eastern Airlines (CEA.NYSE, 600115.SH, 0670.HKG), posted double-digit profit declines year-on-year in the third quarter, South China Morning Post reported. The mainland’s flagship carrier Air China recorded a decrease of 16.5% in net profit to US$507 million (RMB3.17 billion) in the third quarter with JP Morgan stating in a recent note that passenger operations have been weak. The Beijing-based carrier hopes to issue bonds next year to fund spending that includes 56 new aircraft that will cost US$4.2 million. Separately, Shanghai-based China Eastern Airlines posted net profit decline of 20.4% year-on-year to US$421 million in the third quarter, with recent weak cargo traffic, according to JP Morgan. Its revenue rose 2.8% to US$4 billion. China Eastern is planning to receive a capital injection of approximately US$320 million by issuing shares to its parent company.