Airline revenues increase on back of cargo boost

By Amy Su  /  Staff reporter

Tue, Dec 11, 2012 - Page 13

Revenue for the nation’s two largest airlines rose last month from October on the back of sales momentum from the cargo sector, driven by strong shipments of newly launched electronic products.

China Airlines (CAL, 中華航空) posted revenue of NT$10.5 billion (US$360.21 million) last month, up 1.25 percent from October, the company said in its stock exchange filing yesterday.

Revenue from its cargo sector amounted to NT$3.48 billion, up 12.62 percent from October, and was the major driver supporting the airline’s sales last month.

“Increased shipments of electronic products have helped raise demand for the cargo business,” CAL spokesman Hamilton Liu (劉國芊) said by telephone.

For its passenger sector, sales continued to slow on entering the traditional low season, totaling NT$6.59 billion last month, down 3.65 percent from October.

EVA Airways Corp (EVA, 長榮航空) posted similar trends in sales, generating NT$8.64 billion in revenue last month, up 0.58 percent from a month earlier, according to the company’s stock exchange filing data.

Its cargo revenue surged 4.04 percent to NT$3.09 billion last month from October, while sales for passenger business were down 1.38 percent month-on-month at NT$4.99 billion, data showed.

However, on an annual basis, sales for CAL and EVA showed differing trends last month.

CAL’s revenue decreased 0.59 percent last month, as cargo business remained weak compared with the same period last year.

EVA’s sales rose 8.85 percent last month from a year earlier, with cargo revenue up 9.57 percent, an indication that its move to sign a contract with Apple Inc to ship new products has boosted demand.

Both carriers had higher passenger figure last month from a year ago, with growth for CAL and EVA standing at 5.6 percent and 7.54 percent respectively.

CAL posted sales of NT$121.26 billion in the first 11 months of the year, up 0.38 percent from a year earlier, while cumulative revenue reached NT$97.81 billion for EVA, up 4.46 percent year-on-year.

The latest report by Fubon Securities Co (富邦證券) said carriers focusing on long-haul routes may post higher revenue growth next year on the back of the gradual recovery of the global economy and the US Visa-Waiver Program.

However, the emergence of low-cost carriers could hurt TransAsia Airways Corp’s (TNA, 復興航空) market share as it focuses more on regional routes between Asian cities.