春秋航空(601021):23年一季度扭亏为盈 盈利加速修复进行时

Spring Airlines (601021): When the first quarter of '23 turned a loss into profit and profit accelerated recovery

光大證券 ·  04/27  · Researches

Event: The company released its 2022 annual report and the first quarter report of 2023. The company achieved operating income of 8.37 billion yuan in 2022, a year-on-year decrease of 22.9%; realized a net loss of 3.04 billion yuan to return to the mother from profit to loss compared to the same period last year (profit of 39 million yuan); realized net loss of 3.20 billion yuan after deducting net loss of 3.20 billion yuan, an increase of 3.09 billion yuan over the previous year's loss (110 million yuan). The company achieved operating income of 3.86 billion yuan in the first quarter of 2023, an increase of 63.6% over the previous year; achieved net profit of 360 million yuan to return to mother, turning a loss into a profit over the previous year; and achieved net profit of 3.4 billion yuan after deduction, turning a loss into a profit over the previous year.

The domestic epidemic was repeated in '22, and the company ASK declined year-on-year. The company's 2022 ASK (available seat kilometers) fell 27.0% from 2021 and 30.1% from 19. Its domestic routes ASK in China fell 26.8% from 2021 and increased 7.6% from 19; overseas aviation supply and demand remained low. In 2022, international routes and regional routes ASK fell 98.8% and 97.3% respectively from 19. The company's overall passenger occupancy rate in 2022 was 74.7%, down 8.2 pct from 2021 and 16.2 pct from 19. The company operated a total of 116 airliners at the end of December 2022, an increase of 2.7% over the end of 2021, which was lower than the growth rate of the same period last year (10.8%).

Passenger kilometer earnings picked up, and passenger transportation revenue declined year over year. The company's passenger kilometer revenue in '22 was 0.358 yuan, up 16.8% year on year, and its domestic passenger kilometer revenue in China increased 14.9% year on year. Based on the combined volume and price impact, the company achieved passenger revenue of 8.10 billion yuan in '22, a year-on-year decrease of 23.0%.

Fluctuations in oil remittances exacerbated the company's financial losses. Due to the epidemic, flight volume declined year-on-year. In 2022, the company's take-off and landing fees and civil aviation infrastructure funds fell 26.0% and 31.5%, respectively; in '22, the average price of Brent crude oil was about 101.5 US dollars/barrel, up 43% year on year, and the company's aviation fuel costs increased 17.3% year on year; maintenance costs increased 82.2% year on year, mainly due to increased engine repair costs. Taken together, the company's main cost in 2022 increased 2.5% year on year; the gross margin of the main business was -40.45%, a decrease of 34.9pct over the previous year. Furthermore, due to large exchange rate fluctuations, the company incurred a net exchange loss of 130 million yuan in '22, and financial expenses increased 117% year-on-year.

The company's recovery rate led the industry, with 23Q1 revenue exceeding the same period in '19. According to statistics from the Civil Aviation Administration, the passenger traffic volume of the entire industry in the first quarter of 2023 recovered to 80% of the same period in '19. Spring Airlines led the industry's recovery rate. Passenger traffic in the first quarter of 2023 recovered to 95.7% in the same period in '19. Passenger traffic on domestic routes in China increased 24.5% over the same period in '19, and passenger traffic on international and regional routes recovered to 20% and 31% respectively in the same period in '19.

The company's domestic passenger kilometer revenue in the first quarter of 2023 achieved a nearly double-digit increase compared to the same period in '19; international and regional ticket prices in March were still high compared to '19.

Investment suggestions: Demand for air passenger transport is recovering rapidly, the company's operating data is recovering quickly, and losses have been reversed in Q1 in '23; the company continues to maintain an active expansion strategy (fixed increase has been implemented). Relying on its own competitive advantage, the company's profitability will continue to recover, and growth will gradually be reflected at the same time. Considering the positive recovery trend in domestic air passenger demand, we raised the company's net profit forecasts for 23 and 24 to 2.010 billion yuan and 3.09 billion yuan respectively (originally 1.49 billion yuan and 2.56 billion yuan), and the new company's 25-year net profit forecast to 4.01 billion yuan; maintaining the company's “increase in holdings” rating.

Risk warning: The duration and scope of the COVID-19 pandemic has exceeded expectations; the macroeconomic downturn affects the decline in aviation demand; the hourly capacity of airports is rising slowly; passenger throughput on overseas routes is growing slowly.

This page is machine-translated. Futubull tries to improve but do not guarantee the accuracy and reliability of the translation, and will not be liable for any loss or damage caused by any inaccuracy or omission of the translation.

Risk disclosure: The above content only represents the opinion of the authors or guests, and does not represent any positions of Futu or constitute any investment advice on the part of Futu. Before making any investment decision, investors should consider the risk factors related to investment products based on their own circumstances and consult professional investment advisers where necessary. Futu makes every effort to verify the authenticity, accuracy, and originality of the above content, but does not make any guarantees or promises.

    Write first comment