Hainan Airlines Q1 profits up 8%

Updated: 2011-04-21 10:29
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BEIJING - Hainan Airlines said on Wednesday that its net profits rose 8.24 percent over the previous year to 273 million yuan ($41.8 million) in the first quarter of this year.

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Revenue totaled 5.76 billion yuan in the first three months of this year, up 23.14 percent from a year ago, the company said in a statement filed with the Shanghai Stock Exchange. Earnings per share stood at 0.07 yuan during the period, up 16.67 percent from one year ago.

A report from China International Capital Corporation said that although rising demand and ticket prices helped the carrier maintain fast growth in revenue, higher oil prices affected its profitability.

Analysts expected continuous higher-than-expected profits in the future, bolstered by the government's plan to build Hainan island into a world-renowned tourist destination.

The Hainan provincial government launched a tax rebate program on Wednesday as part of the stimulus plan for tourism. Tourists visiting the island and local residents will be able to purchase tax-free commodities from designated businesses before flying to other destinations in China.

Dong Ding, analyst with GF Securities said that Hainan Airlines will be the biggest beneficiary of the program, as the company is based in Haikou, capital of the province.