Fri, Mar 04, 2005 - Page 10 News List

China Airlines stands behind 2005 earnings forecast

By Kevin Chen  /  STAFF REPORTER

Despite sustained high fuel prices, China Airlines (華航) yesterday maintained an earlier forecast for annual pretax profit of NT$4.4 billion this year, or nearly 10 percent growth.

The nation's largest air carrier also predicted its revenues for this year will break the NT$100 billion level for the first time, China Airlines president Philip Wei (魏幸雄) told reporters during a lunch yesterday.

The carrier expects to achieve NT$105.5 billion in revenue this year, up from NT$96.1 billion last year, with revenue in its cargo and passenger business growing 12.7 percent and 8.4 percent this year, respectively, Wei added.

Last year, the company reported NT$4.18 billion in aftertax profits, on record revenues of NT$96.1 billion, marking the firm's best performance in a decade, China Airlines chairman Chiang Yao-chung (江耀宗) said at the same function yesterday.

But like other airlines around the world, China Airlines will also face stiff competition and challenges this year, including the persistent rise in oil prices, high interest rates, the addition of new budget airlines, as well as the liberalization of aviation rights in both China and the US, Chiang said.

Even so, the company will take delivery of 10 new aircraft this year while retiring seven airplanes, in a bid to enhance transport capacity and cut operation costs, he said.

The 10 new planes are five Airbus 330-300 jets, two Boeing 747-400 jets and three Boeing 747-400 freighters.

By the end of this year, the company will have a fleet of 66 aircraft, with an average age of 5.1-years, after the company retires one MD-11 freighter, one B747-400 passenger jet and five A300-600s, according to Wei.

The firm hopes to see a breakthrough in direct cross-strait charter cargo flights in the near future, Chiang said, without elaborating.

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