Air China Expects Big Profit Jump For 2015

Air China's net profit for 2015 is likely to jump 60-80 percent from last year thanks to an increase in revenue and a substantial fall in fuel costs, the state-owned carrier said.

Air China, the country's biggest airline by market value, said in a stock exchange statement it had "captured strong market demand and increased its capacity deployment", which helped to boost revenue.

Net profit attributable to equity holders rose to CNY3.78 billion yuan (USD$574.6 million) in 2014.

Air China said in October its net profit jumped 98.1 percent in the first nine months from a year earlier due to lower fuel price and robust travel demand.

The airline said it had lowered costs in 2015 by "improving the matching of aircraft models, routes and markets, optimising debt structure for interest rate and foreign exchange rate risk aversion, and actively advancing the measures of 'promoting direct sales and lowering agency fees'."

It also benefited from a significant decrease in the price of aviation fuel, helping to lower its costs compared with 2014, the statement said.

Chinese carriers have typically stayed away from fuel hedging after suffering big losses in 2008-2009. That allows them to reap the full benefit when oil prices drop.