CAL, EVA sales go up in summer

FALLING CARGO SALES::China Airlines’ air cargo revenue fell 3.6 percent last month from a year ago, and airlines say passenger revenue would remain their main engine

By Amy Su  /  Staff reporter

Wed, Jul 11, 2012 - Page 13

The nation’s two largest airlines reported higher revenues last month, bolstered by growth in passenger traffic as the summer travel season started. Both carriers also saw second-quarter sales rise more than 3 percent sequentially.

China Airlines (CAL, 中華航空), the nation’s largest carrier, posted NT$11.46 billion (US$382 million) in revenue last month, up 3.79 percent from a year earlier and 5.04 percent from May, company data showed.

Second-quarter revenue was also up, rising 3.8 percent sequentially to a record NT$33.3 billion, data showed.

The uptrend in passenger traffic also drove up EVA Airways Corp’s (EVA, 長榮航空) revenue during the April-to-June period.

Revenue for the nation’s second-largest carrier last month grew 4.1 percent year-on-year to NT$9.27 billion. The figure was also up 8.17 percent from May, the company said in a stock exchange filing.

Second-quarter revenue rose 3.1 percent sequentially to NT$26.36 billion, company data showed.

With the summer travel season commencing, CAL saw its passenger revenue last month expand 7.36 percent from the previous year to NT$7.29 billion, while EVA’s increased 11.76 percent, data showed.

However, cargo traffic remained weak, with CAL’s air cargo revenue last month sliding 3.6 percent from a year ago to NT$3.74 billion, while EVA’s plummeted 10.44 percent, figures showed.

EVA said it expected passenger sales to remain its main growth driver in the near term.

“Seasonal demand [for passenger flights] would support the business during the third quarter as predicted,” EVA president Chang Kuo-wei (張國煒) told reporters earlier this month.

CAL president Sun Hung-hsiang (孫洪祥) also said on the sidelines of a press conference that the carrier planned to gradually lower cargo sales to 30 percent of its business, from 35 percent, as the carrier hoped to focus more on the short-haul passenger routes to China.

Capital Securities Corp (群益證券) shared Sun’s views in its latest report on the airlines industry.

“The profitability of cross-strait passenger routes would remain Taiwanese airlines’ main driver this year,” the brokerage house said in the report.

Capital Securities expects local carriers to turn losses into gains in the third quarter as their passenger business takes off and global crude oil prices weaken.

Revenue for TransAsia Airways Corp (復興航空) — the third listed Taiwanese airline which focuses on passenger business — totaled NT$759.72 million, up 3.3 percent from a year earlier, company statistics showed.