China Express(SZ:002928) Shenwan Hongyuan Securities·2025-08-29 12:45Investment Rating - The report maintains an "Outperform" rating for Huaxia Airlines [2] Core Insights - Huaxia Airlines reported a strong performance in the first half of 2025, with total revenue reaching 3.61 billion yuan, a year-on-year increase of 12.41%, and a net profit attributable to shareholders of 251 million yuan, up 858.95% year-on-year, exceeding expectations [7] - The company benefits from the continuous improvement in civil aviation travel demand, actively increasing flight volumes and enhancing fleet utilization, leading to improved operational quality [7] - The airline's available seat kilometers (ASK) reached 8.86 billion, a 21.41% increase year-on-year, while passenger kilometers (RPK) reached 7.22 billion, up 27.13% year-on-year, with a seat load factor of 81.53%, an increase of 3.67 percentage points year-on-year [7] Financial Data and Profit Forecast - For 2025, total revenue is projected to be 7.94 billion yuan, with a year-on-year growth rate of 18.6%, and net profit is expected to reach 624 million yuan, reflecting a 132.7% increase year-on-year [6] - The gross profit margin is expected to improve significantly from 2.9% in the first half of 2025 to 10.1% in 2025E, and return on equity (ROE) is projected to rise to 15.7% in 2025E [6] - The company plans to enhance its route network, particularly in remote areas, which is expected to further increase comprehensive route revenue [7]