Air China(601111) 光大证券·2024-11-07 14:22Investment Rating - The report maintains a "Buy" rating for the company [6] Core Views - The company reported a slight decline in net profit attributable to shareholders in Q3, while total revenue showed a year-on-year increase [1] - The recovery in air travel demand is expected to continue, with RPK surpassing 2019 levels [2] - The company is facing challenges with revenue per kilometer declining, but cost improvements are anticipated [3][4] Summary by Sections Financial Performance - For the first three quarters of 2024, the company achieved total revenue of 128.2 billion yuan, up 21.5% year-on-year, and a net profit of 1.362 billion yuan, up 72.06% year-on-year [1] - In Q3 alone, total revenue was 48.6 billion yuan, a 6.03% increase year-on-year, while net profit was 4.144 billion yuan, a decrease of 2.31% year-on-year [1] Demand and Capacity - Domestic air travel demand has shown a recovery, with RPK increasing by 34% year-on-year and 22% compared to the same period in 2019 [2] - International RPK growth was particularly strong at 168% year-on-year, indicating robust recovery in overseas routes [2] - The company operated 924 aircraft as of September 2024, an increase of 16 aircraft since the beginning of the year [3] Revenue and Cost Analysis - The revenue per kilometer (RPK) for the first three quarters was 0.48 yuan/ASK, down 0.03 year-on-year, while Q3 RPK was 0.50 yuan/ASK, down 5.7% year-on-year [3] - The cost per kilometer (ASK) for the first three quarters was 0.45 yuan/ASK, up 1.2% year-on-year, with Q3 showing a decrease of 1.5% year-on-year [3] Future Outlook - The report anticipates continued recovery in civil aviation demand, supported by both domestic and international factors [3] - The forecast for net profit for 2024-2026 has been adjusted downward, with expected figures of 237 million yuan (down 97%), 6.075 billion yuan (down 39%), and 10.184 billion yuan (down 16%) respectively [4] - Despite the challenges, the report maintains a positive outlook on the recovery of the aviation market and the potential for profit improvement under constrained supply conditions [4]