Although Taiwan’s three listed airlines suffered a loss-making second quarter, all three saw net losses during the quarter contract from the first quarter, helped by reduced aviation fuel price hikes.
China Airlines Ltd (CAL, 中華航空), the biggest of the trio, posted NT$116.23 million (US$3.87 million), or NT$0.03 per share, in net losses, improving from net losses of NT$317.14 million, or NT$0.06 per share, recorded a year earlier, it said in its filing to the Taiwan Stock Exchange.
On a quarterly basis, the result in the second quarter was a substantial improvement over net losses of NT$1.11 billion, or 0.21 per share, recorded in the first quarter, CAL data showed.
In the first half of this year, net losses totaled NT$1.22 billion, or NT$0.24 per share, compared with NT$1.65 billion, or NT$0.32 per share, recorded a year earlier, the data showed.
EVA Airways Corp’s (EVA, 長榮航空) net losses were similar.
The nation’s second-largest airline posted net losses of NT$178.7 million, or NT$0.06 per share, improving from losses of NT$245.33 million, or 0.07 per share, recorded during the same period last year, its stock exchange filing showed.
The NT$178.7 million net loss was also better than the NT$917.02 million, or NT$0.28 per share, loss it reported during the January-to-March period, EVA data showed.
In the first six months, the carrier saw net losses total NT$1.1 billion, or NT$0.34 per share, down from net losses of NT$959.83 million, or NT$0.29 per share, recorded a year earlier, the data showed.
“[EVA’s] net loss shrank markedly in the second quarter, as passenger traffic and yields rose and cost efficiency improved,” JPMorgan analyst Corrine Png (方華婷) said in a research report.
JPMorgan forecast EVA would post a net profit this year of NT$41 million, or NT$0.01 per share, but that market expectations of NT$2.4 billion net profits would be an overly optimistic forecast.
EVA’s cargo business, which remained weak in the second quarter, is still one of the arline’s biggest risk factors in the second half of this year, as its disadvantage of oversupply is expected to persist until next year, Png said.
Meanwhile, rising competition from low-cost carriers and potential capital-raising risks due to efforts to renew and expand its ageing fleet, are other downside risks facing the carrier, JPMorgan said.
TransAsia Airways Corp (TNA, 復興航空), which mainly operates regional and cross-strait passenger routes, reported NT$56.84 million, or NT$0.1 per share, in net losses, shrinking from NT$129.46 million, or NT$0.23 per share, in the first quarter, Taiwan Stock Exchange data showed.
The result was a major setback compared with NT$47.58 million net profits, or earnings per share of NT$0.09, TransAsia recorded in the second quarter last year, its statistics showed.