China Southern Airlines has recorded a net profit of 711 million yuan ($106 million) in the third quarter.
Propelled by strong domestic demand and lower fuel prices, China Southern’s results for July to September mark a bright spot for the troubled airline industry. However, the carrier, which is China’s largest, incurred a 7.5 billion yuan ($1.1 billion) loss overall in the first nine months of 2020.
Its competitors, Air China and China Eastern Airlines, lost 671 million yuan ($100 million) and 563 million yuan ($84 million), respectively, during the same quarter. China Southern operates the largest domestic network out of the ‘big three’ state-owned carriers, according to Reuters.
During the month of September, the airline carried over 11 million domestic passengers, up 2.5 per cent year-on-year. Meanwhile, the number of international passengers fell to 80,840, a decline of 95 per cent compared to the same time last year.
“With the gradual stabilisation of the domestic pandemic control situation, domestic civil aviation is showing a steady recovery and development trend,” said China Southern in a disclosure to investors. “However, due to the impact of the overseas pandemic, the scale of passenger transportation on international routes continues to remain low.”
This summer, China Southern unveiled ‘all you can fly’ deals for as low as 3,699 yuan ($529) to stimulate demand. Domestic travel within China has largely recovered since the peak of the pandemic. Chinese carriers are now flying 9.5 per cent more flights year-on-year, averaging about 11,700 flights weekly, according to data analytics company Cirium.
China’s GDP is expected to increase by 1.9 per cent in 2020 and will be the only major economy that grows, said the International Monetary Fund last month.