Hainan Airlines Holding reported a net profit of CNY729 million ($106 million) for the first nine months, a 73.6% decline compared to the year-ago period.

Revenue for China’s largest private airline group was up 15.9% to CNY52.3 billion year-over-year (YOY), while operating profit was down 73.6% to CNY916 million. Operating costs of CNY53.5 billion and a weakened Chinese yuan against the US dollar contributed to the decline, the company said.

Flagship carrier Hainan Airlines saw operating revenue grow 11.7% to CNY29.8 billion, as costs also increased 21% to CNY25 billion. Operating profit was down 72% to CNY721 million, as was net profit, to CNY616 million.

The Shanghai-based group’s capacity grew 17.7% and RPKs were up 15.9%. Domestic passengers accounted for about 93% of the total 59.8 million passengers for the period.

The group carried 16.5% more international passengers YOY, with RPK increasing by 23.7% and ASK by 25.9%, with a load factor of 75%.

The group’s fleet grew to 436 aircraft, as the airlines took in four Boeing 787-9, three 737-800s, an Airbus A350-900 and an A320. 

The HNA Group, a Hainan affiliate, is reportedly seeking to divest its aviation businesses by selling Lucky Air. Talks are underway to sell a 60% stake in the LCC to China Eastern Airlines, and 40% to Yunnan SASAC, the province’s state-owned asset regulator. HNA has already sold numerous overseas assets to ease mounting debts, but the move to sell Lucky Air would be the first from its aviation portfolio. 

Chen Chuanren, chuanren@purplelightvisuals.com