Sat, Mar 30, 2019 - Page 12 News List

EVA Airways net profit rises on passenger revenue

MITIGATING FACTORS:A rise in passenger yield and replacement of 747s with more energy-efficient aircraft helped the carrier overcome higher fuel prices and flying time

By Kao Shih-ching  /  Staff reporter

EVA Airways Corp (長榮航空) yesterday reported that net profit for last year rose 13.9 percent annually to NT$6.55 billion (US$212.49 million), or earnings per share of NT$1.5, on rising revenue contribution from its passenger division, despite higher fuel prices.

“Happily, the effects of higher fuel prices were offset by higher passenger revenue and improved load factor, as we managed to sell more business-class and premium economy-class seats,” EVA president Clay Sun (孫嘉明) told an investors’ conference in Taipei.

Sales of business-class and premium economy-class seats increased by about 10 percent and 20 percent respectively from a year earlier, the carrier said.

With the passenger load factor last year increasing to 80.8 percent, the firm saw passenger revenue grow 7.2 percent annually to NT$99.1 billion, driving passenger yield — the average fare per passenger per mile (1.6km) — 1.6 percent higher to NT$2.05, Sun said.

EVA said that it consumed 15.63 million barrels of fuel last year, flat from a year earlier, even though it flew more, as the carrier replaced older Boeing Co 747s with more energy-efficient airplanes.

Total fuel costs last year advanced 26 percent year-on-year to NT$42.13 billion, as fuel prices jumped 32 percent to US$85 per barrel, from US$64 per barrel in 2017, it said.

As for the air cargo business, EVA saw its cargo load factor decline slightly to 83.5 percent, but cargo revenue advanced 11.3 percent to NT$27.6 billion thanks to the growth in yearly cargo volume and better shipping prices, company data showed.

“US-China trade tensions did no harm to EVA’s passenger business. Instead, we even benefited slightly from more Chinese businesspeople flying with us when looking for places to relocate their production bases,” Sun said.

“However, the trade war affected our cargo business, as we saw cargo volume in the fourth quarter drop from a year earlier,” he said.

EVA would adjust its cargo routes on a rolling basis by monitoring supply-chain transfers amid the trade war, he added.

Passenger and cargo revenue would likely grow 7 percent and 5 percent annually this year respectively, while fuel prices might hover at between US$70 and US$80 per barrel, compared with US$85 last year, EVA executive vice president David Tsai (蔡大煒) said.

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