Air China 2008 1Q Results
Air China Ld
25 April 2008
The Stock Exchange of Hong Kong Limited takes no responsibility for the contents
of this announcement, makes no representation as to its accuracy or completeness
and expressly disclaims any liability whatsoever for any loss whatsoever arising
from or in reliance upon the whole or any part of the contents of this
announcement.
(a joint stock limited company incorporated in the People's Republic of China
with limited liability)
(Stock Code: 753)
(1) FIRST QUARTERLY REPORT 2008
(OVERSEAS REGULATORY ANNOUNCEMENT)
(2) APPOINTMENT OF CHAIRMAN OF THE SECOND SESSION OF
THE BOARD (OVERSEAS REGULATORY ANNOUNCEMENT)
(3) SALE OF CERTAIN EQUITY INTEREST HELD BY
CHINA NATIONAL AVIATION COMPANY LIMITED
(OVERSEAS REGULATORY ANNOUNCEMENT)
(4) AMENDMENT OF THE ARTICLES OF ASSOCIATION
OF THE COMPANY
The board of directors (the 'Board') of Air China Limited (the 'Company') hereby
announces that a meeting of the Board (the 'Board Meeting') was held on 24 April
2008 and passed resolutions relating to:
1. the results for the first quarter ended 31 March 2008;
2. the appointment of Mr. Kong Dong as Chairman of the second session of
the Board;
3. the sale of equity interest held by China National Aviation Company
Limited ('CNAC') in Fly Top Limited, China National Aviation Logistics Company
Limited and Jardine Airport Services Limited to China National Aviation
Corporation (Group) Limited ('CNACG'); and
4. the amendment of Article 20 of the articles of association of the
Company (the 'Articles of Association') in respect of the Company's share
capital structure.
The announcement as set out in section I, II, and III below is made pursuant to
Rule 13.09 of the Rules Governing the Listing of Securities on the Stock
Exchange of Hong Kong Limited (the 'Hong Kong Listing Rules').
The Board of the Company hereby announces that the Board Meeting was held on 24
April 2008 and passed resolutions on the following subjects.
I. FIRST QUARTERLY REPORT 2008
1. IMPORTANT NOTICE
1.1 The board of directors, the Supervisory Committee, as well as the
directors, supervisors and senior management of the Company hereby warrant that
there are no false representations, misleading statements or material omissions
in this report, and the Directors, Supervisors and the senior management
individually and jointly accept full responsibility for the truthfulness,
accuracy and completeness of the contents of this report.
1.2 Director Mr. Wang Shixiang was unable to attend the Board meeting due to
business engagement, and appointed Mr. Kong Dong to attend and vote on his
behalf.
Director Mr. Yao Weiting was unable to attend the Board meeting due to business
engagement, and appointed Mr. Ma Xulun to attend and vote on his behalf.
Independent Director Mr. Jia Kang was unable to attend the Board meeting due to
business engagement, and appointed Mr. Wu Zhipan to attend and vote on his
behalf.
1.3 The First Quarterly Report of the Company was unaudited.
1.4 The Chairman of the Company Kong Dong, Chief Financial Officer Fan Cheng
(Person in charge of accounting function), and the General Manager of Finance
Department Li Youqiang hereby jointly declare that the financial statements set
out in this quarterly report is true and complete.
2. BASIC INFORMATION OF THE COMPANY
2.1 Major accounting data and financial ratios
In RMB
At the end of the At the end of Increase/
reporting period previous year (decrease) at
the end of the
reporting period
as compared to
the end of the
pervious year
(%)
Total assets (RMB'000) 93,179,455 88,295,239 5.53
Owner's equity 31,288,095 2.16
(or shareholders' equity)
attributable to 31,964,545
shareholders of the listed
company (RMB'000)
Net asset per share 2.69 2.64 1.89
attributable to
shareholders of the
Company (RMB)
From the Increase/(decrease)
beginning of the year over the corresponding
to the end of the period of previous year
reporting period
(%)
Net cash flows from 2,086,620 33.09
operating activities
(RMB'000)
Net cash flows from 0.18 38.46
operating activities per
share (RMB)
Reporting From the Increase/
period beginning of (decrease) of
the year to this reporting
the end of period as
the reporting compared to the
period corresponding
period of
previous year
(%)
Net profit attributable 1,044,014 1,044,014.00 147
to shareholders of the
Company (RMB'000)
Basic earnings per share 0.09 0.09 147
(RMB)
Basic earnings per share 0.09 0.09 143
after exceptional gains
and losses (RMB)
Diluted earnings per share n/a n/a n/a
(RMB)
Fully diluted return 3.27 3.27 Increase by
on net assets (%) 2 percentage
points
Fully diluted return on net 3.29 3.29 Increase by
assets after exceptional 2 percentage
gains and losses (%) points
Exceptional gain and loss items From the beginning of the year to
the end of the reporting period
(RMB'000)
Gains and losses from disposal of -9,419
non-current assets
Government grants (except for the grants 34,623
which are closely related to the Company's
business and have the standard amount and
quantities in accordance with the national
standard) attributable to gains and losses
for the period
Other non-operating net income and expenses -33,810
apart from those stated above
Effect of income tax 2,151
Total -6,454
2.2 Total number of shareholders and top 10 holders of listed shares not
subject to trading moratorium as at the end of the reporting period
Unit: Share
Total number of shareholders at the end of the 543,656
reporting period
Particulars of the top 10 holders of listed shares not subject to trading
moratorium
Name of shareholder Number of listed Class of Shares
(full name) shares not subject to
trading moratorium
held as at period end
CATHAY PACIFIC AIRWAYS 2,217,617,455 Overseas listed
LIMITED foreign shares
HKSCC NOMINEES LIMITED 2,160,199,899 Overseas listed
foreign shares
China National Aviation 122,870,578 RMB ordinary shares
Holding Company
Sinotrans Air Transportation 80,000,000 RMB ordinary shares
Development Co., Ltd.
China Shipbuilding Industry 50,000,000 RMB ordinary shares
Corporation
Rongtong New Blue Chip 35,581,473 RMB ordinary shares
Securities Investment Fund
Three Gorges Finance Co., Ltd. 35,000,000 RMB ordinary shares
China Yangtze Power Co., Ltd. 35,000,000 RMB ordinary shares
China General Technology 32,800,000 RMB ordinary shares
(Group) Holding Limited
China Power Finance Co., Ltd. 32,080,472 RMB ordinary shares
3. SIGNIFICANT EVENTS
3.1 Significant changes of the principal accounting statements and financial
indicators and reasons thereof
(X) applicable ( ) not applicable
1. Net profit attributable to the Company
During the reporting period, net profit attributable to the Company
increased by 147% as compared with the same period of last year. The reason for
the increase was mainly attributable to the stable growth of the aviation
market, increase of passenger yield per kilometer and exchange gains from
appreciation of Renminbi.
2. Net cash flow generated from operating activities
During the reporting period, net cash flow generated from the operating
activities of the Company increased by 33% as compared with the same period of
last year. The main reasons was the increase in sales revenue and the merger of
accounts of Air China Cargo following acquisition of its equity interests thus
leading to the increase in net cash flow generated from operating activities.
3. Goodwill
During the reporting period, the Company's goodwill increased RMB267.83
million or 278.78% because of the accounting of Air China Cargo as a subsidiary
following acquisition of its equity interests. The acquisition premium was
accounted for as goodwill.
4. Minority interests
During the reporting period, the minority interests of the Company
increased RMB417.535 million or 277.96%. The main reason was the accounting of
Air China Cargo as subsidiary following acquisition of its equity interests and
inclusion of its minority interests under minority interests of the Company.
5. Exchange differences arising from conversion of foreign currency
financial statement
During the reporting period, the exchange deficit arising from
converting the Company's foreign currency statement increased RMB397.564 million
or 39.1%, mainly due to a greater fluctuation in exchange rate during the
period.
3.2 Analysis and explanation on the progress of significant events and their
impact and resolutions
(X) applicable ( ) not applicable
(1) On 26 February 2007, the Eastern District Court of New York of the
Federal Judiciary of the United States filed a civil summon against the Company
and Air China Cargo,claiming that they, together with a number of other
airlines, have violated certain antitrust regulations in respect of their air
cargo operations in the United States by acting in concert in imposing excessive
surcharges to impede the offering of discounts and allocating revenue and
customers so as to achieve increasing, maintaining and stabilizing air cargo
prices. As the status of the proceedings is still in the preliminary stage, the
Directors of the Company are of the view that it is not possible to estimate the
eventual outcome of the claim with reasonable certainty and therefore no
provision for this claim has been made at this stage.
(2) The 2007 second extraordinary general meeting of the Company has approved
the additional offer of not more than 400 million shares of A shares to the
public by the Company. The matter is being considered and reviewed by China
Securities Regulatory Commission.
3.3 Performance of undertakings given by the Company, the shareholders and
the effective controlling person
(X) applicable ( ) not applicable
China National Aviation Holding Company and China National Aviation Corporation
(Group) Limited made an undertaking that it would not transfer, or nominate
other persons to manage, the shares of the Company held by it, and none of these
shares would be acquired by the Company, during the period of 36 months from the
listing date of the A shares of the Company.
3.4 Warning in respect of forecast of possible net loss from the beginning
of the year to the end of the next Reporting Period or warning in respect of any
significant changes in net profit as compared with that of the corresponding
period of previous year and the reasons therefore
( ) applicable (X) not applicable
3.5 Particulars of the Securities Investment
( ) applicable (X) not applicable
Air China Limited
Chairman: Kong Dong
24 April 2008
4. APPENDIX
4.1 Consolidated Balance Sheet
31 March 2008
Prepared by Air China Limited
Unit: RMB'000 (Unaudited)
Items Balance at Balance at
the end the beginning
of the period of the year
CURRENT ASSETS:
Cash and bank balances 4,493,080 3,787,152
Provisions on payables - -
Contributions received - -
Trading financial assets 46,207 6,493
Bills receivable 4,571 1,599
Accounts receivable 3,029,666 2,812,327
Prepayments 356,973 311,784
Premium receivable - -
Receivables on reinsurance - -
Provisions for reinsurance contracts - -
Interests receivable - -
Dividend receivable - -
Other receivables 907,630 997,205
Purchase of financial assets resold - -
Inventories 792,424 755,340
Non-current assets due within a year - -
Other current assets - -
Total current assets 9,630,551 8,671,900
NON-CURRENT ASSETS:
Loans and advances - -
Available-for-sale financial assets - -
Held-to-maturity investment - -
Long-term receivables 314,922 255,340
Long-term equity investment 10,290,604 11,404,643
Investment property - -
Fixed assets 59,483,204 55,000,376
Construction in progress 10,864,504 10,967,888
Construction materials - -
Disposal of fixed assets - -
Biological assets for production - -
Oil and gas assets - -
Intangible assets 1,581,235 1,396,620
Development expenses - -
Goodwill 499,775 131,945
Long-term deferred expenses 83,840 80,684
Deferred income tax assets 430,820 385,843
Other non-current assets - -
Total non-current assets 83,548,904 79,623,339
Total assets 93,179,455 88,295,239
CURRENT LIABILITIES:
Short-term borrowings 6,810,312 6,546,088
Borrowings from central bank - -
Deposits from clients and placements from - -
other banks
Contributions made - -
Trading financial liabilities 35,173 14,826
Bills payable - -
Accounts payable 6,787,788 6,338,341
Receipts in advance 62,033 53,778
International air traffic liabilities 1,559,711 1,702,490
Domestic air traffic liabilities 405,242 437,473
Salaries and wages payable 269,079 254,073
Taxes payable 1,240,781 1,906,067
Interests payable 338,829 273,824
Dividend payable - -
Other payables 2,058,957 2,221,096
Amounts payable on reinsurance - -
Provisions on insurance contracts - -
Brokerage payable - -
Underwriting fees payable - -
Non-current liabilities due within a year 7,074,143 6,344,212
Other current liabilities - -
Total current liabilities 26,642,048 26,092,268
NON-CURRENT LIABILITIES:
Long-term borrowings 15,556,773 12,938,092
Debentures payable 3,000,000 3,000,000
Long-term payables 14,667,283 14,630,037
Specific payables - -
Estimated liabilities 202,976 191,533
Deferred income tax liabilities 578,081 5,000
Other non-current liabilities - -
Total non-current liabilities 34,005,113 30,764,662
Total liabilities 60,647,161 56,856,930
OWNER'S EQUITY (OR SHAREHOLDERS'
EQUITY):
Paid-up capital (or equity) 12,251,362 12,251,362
Capital surplus 11,882,408 11,852,408
Less: Treasury shares - -
Surplus reserves 1,299,214 1,299,214
General risk provisions - -
Profit available for appropriation 7,932,857 6,888,843
Currency translation differences -1,401,296 -1,003,732
Total equities attributable to owners of Company 31,964,545 31,288,095
Minority interests 567,749 150,214
Total owners' equity 32,532,294 31,438,309
Total liabilities and owners' equity 93,179,455 88,295,239
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
Balance Sheet of the Company
31 March 2008
Prepared by Air China Limited
Unit: RMB'000 (Unaudited)
Items Balance at the Balance at the
end of the period beginning of
the year
CURRENT ASSETS:
Cash and bank balances 2,796,308 1,351,373
Trading financial assets 46,207 6,493
Bills receivable 4,571 1,599
Accounts receivable 2,562,333 2,446,047
Prepayments 285,640 264,840
Interests receivable - -
Dividend receivable - -
Other receivables 1,113,915 984,279
Inventories 718,282 689,871
Non-current liabilities due within a year - -
Other current assets - -
Total current assets 7,527,256 5,744,502
NON-CURRENT ASSETS:
Available-for-sale financial assets - -
Held-to-maturity investment - -
Long-term receivables 242,175 192,848
Long-term equity investment 13,864,156 13,804,257
Investment property - -
Fixed assets 56,191,104 54,672,583
Construction in progress 10,749,855 10,967,675
Construction materials - -
Disposal of fixed assets - -
Biological assets for production - -
Oil and gas assets - -
Intangible assets 1,382,868 1,396,527
Development expenses - -
Goodwill - -
Long-term deferred expenses 77,670 79,307
Deferred income tax assets 394,105 372,000
Other non-current assets - -
Total non-current assets 82,901,933 81,485,197
Total assets 90,429,189 87,229,699
CURRENT LIABILITIES:
Short-term borrowings 6,797,312 6,533,088
Trading financial liabilities 15,494 6,819
Bills payable - -
Accounts payable 5,726,963 5,750,093
Receipts in advance 51,093 27,235
International air traffic liabilities 1,469,273 1,575,568
Domestic air traffic liabilities 402,142 437,473
Salaries and wages payable 221,097 248,977
Taxes payable 1,217,606 1,895,869
Interests payable 324,506 273,824
Dividend payable - -
Other payables 1,958,732 2,067,698
Non-current liabilities due within a year 6,971,148 6,344,212
Other current liabilities - -
Total current liabilities 25,155,366 25,160,856
NON-CURRENT LIABILITIES:
Long-term borrowings 14,572,127 12,938,092
Debentures payable 3,000,000 3,000,000
Long-term payables 14,476,144 14,427,049
Specific payables - -
Estimated liabilities 202,976 191,533
Deferred income tax liabilities 578,081 5,000
Other non-current liabilities - -
Total non-current liabilities 32,829,328 30,561,674
Total liabilities 57,984,694 55,722,530
OWNER'S EQUITY (OR SHAREHOLDERS'
EQUITY):
Paid-up capital (or equity) 12,251,362 12,251,362
Capital surplus 14,310,532 14,280,532
Less: Treasury shares - -
Surplus reserves 1,289,624 1,289,624
Profit available for appropriation 4,592,977 3,685,651
Total owner's equity (or shareholders' equity) 32,444,495 31,507,169
Total liabilities and owner's equity 90,429,189 87,229,699
(or shareholders' equity)
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
4.2 Consolidated Income Statement
January to March 2008
Unit: RMB'000 (Unaudited)
Items Amounts for Amounts for the
the period corresponding
period of
previous year
I. Total revenue from operations 12,756,278 10,471,131
Including: Operating income 12,756,278 10,471,131
Interest income - -
Premium earned - -
Fees and commission income - -
II. Total operating cost 12,039,068 10,434,911
Including: Operating costs 11,139,496 9,123,346
Interest expenses - -
Fees and commission expenses - -
Returned premium - -
Net reimbursement paid - -
Net amounts of provisions on insurance - -
contracts drawn
Bonus paid on insurance policy - -
Reinsurance premium - -
Business taxes and other surcharges 314,813 253,554
Selling expenses 800,449 586,168
Administrative expenses 244,274 254,613
Finance expenses -459,964 217,230
Impairment loss of assets - -
Add: Gains from changes in fair value 19,300 256,595
(loss is represented by '-' sign)
Investment income (loss is represented 364,270 220,683
by '-' sign)
Including: Gains arising from investments in 218,854 220,683
associated companies and joint ventures
Exchange gains (loss is represented - -
by '-' sign)
III Profit from operations (loss is represented 1,100,780 513,498
by '-' sign)
Add: Non-operating income 39,473 1,401
Less: Non-operating expenses 48,079 14,686
Including: Net loss arising from disposal - -
of non-current assets
Items Amounts for Amounts for the
the period corresponding
period of
previous year
IV. Total profit (loss is represented by 1,092,174 500,213
'-' sign)
Less: Income tax expenses 84,181 97,079
V. Net profit (loss is represented by '-' sign) 1,007,993 403,134
Net profits attributable to owners of 1,044,014 422,945
Company
Gains or losses from minority interests -36,021 -19,811
VI. Earnings per share:
(I) Basic 0.09 0.04
(II) Diluted n/a n/a
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
Income Statement of the Company
January to March 2008
Unit: RMB'000 (Unaudited)
Items Amounts for Amounts for the
the period corresponding
period of
previous year
I. Revenue from operations 11,292,574 9,849,262
Less: Operating cost 9,654,633 8,492,676
Business taxes and other surcharges 291,259 251,994
Selling expenses 775,159 568,807
Administrative expenses 216,479 215,978
Finance expenses -404,021 234,569
Impairment loss of assets - -
Add: Gains from changes in fair value 31,039 242,055
(loss is represented by '-'sign)
Investment income (loss is represented 205,315 -105,843
by '-' sign)
Including: Gains arising from investments in 59,899 -105,843
associated companies and joint ventures
II. Profit from operations (loss is represented 995,419 221,450
by '-' sign)
Add: Non-operating income 37,807 1,340
Less: Non-operating expenses 47,650 14,682
Including: Net loss arising from disposal - -
of non-current assets
III. Total profit (loss is represented by '-' 985,576 208,108
sign)
Less: Income tax expenses 78,249 86,927
IV. Net profit (loss is represented by '-' sign) 907,327 121,181
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
4.3 Consolidated Cash Flow Statement
January to March 2008
Unit: RMB'000 (Unaudited)
Items Amounts for Amounts for the
the period corresponding
period of
previous year
I. Cash flows from operating activities:
Cash received from sales of goods, 12,016,400 10,189,269
provision of services
Net increase in deposits from clients and - -
placements from other banks
Net increase in borrowings from central bank - -
Net increase in contributions made to other - -
financial institutions
Cash received from premiums of original - -
insurance contracts
Net cash receipt from reinsurance operations - -
Net increase in reserve of the insured and - -
investment
Net increase in trading financial assets - -
Cash received from interests, fees and - -
commission
Net increase in contributions - -
Net increase in cash from repurchase - -
operations
Refund of tax and levy 28,143 -
Other cash received relating to operating 213,848 169,131
activities
Subtotal of cash inflows of operating 12,258,391 10,358,400
activities
Cash paid for goods purchased, services 7,022,906 5,945,414
rendered
Net increase in loans and advances to clients - -
Net increase in deposits to central bank and - -
to other banks
Cash payment of claims under original - -
insurance contracts
Cash payment of interests, fees and - -
commission
Cash payment of bonus paid to insurance - -
policy
Cash paid to or on behalf of employees 1,168,885 946,491
Tax paid 742,176 809,893
Other cash paid in relation to operating 1,237,804 1,088,771
activities
Subtotal of cash outflows of operating 10,171,771 8,790,569
activities
Net cash flows from operating activities 2,086,620 1,567,831
II. Cash flows from investing activities:
Cash received from investments - -
Cash from investment income 14,405 34,807
Net cash from disposal of fixed assets, 24,559 17,045
intangible assets and other long-term assets
Net cash from disposal of subsidiaries and - -
other business units
Other cash received from investing activities 466,902 43,856
Subtotal of cash inflows of investment 505,866 95,708
activities
Cash paid to purchase of fixed assets, 2,709,571 2,304,868
intangible assets and other long-term assets
Cash paid to investments 826,364 3,032,433
Net increase in pledged loans - -
Net cash from subsidiaries and other - -
business units
Cash payments relating to other investments - -
Subtotal of cash outflows of investment 3,535,935 5,337,301
activities
Net cash flows from investing activities -3,030,069 -5,241,593
III. Cash flows from financing activities:
Cash received from investments - -
Including: Cash received from investments of - -
minority shareholders through subsidiaries
Cash received from borrowings 7,695,234 6,572,494
Cash received from issue of debentures - -
Other cash relating to financing activities - -
Subtotal of cash inflows of financing 7,695,234 6,572,494
activities
Cash repaid to amounts borrowed 4,287,843 2,912,369
Cash payments for distribution of dividends, 414,244 465,467
profits or interest expenses
Including: Dividends and profit paid to - -
minority shareholders by subsidiaries
Other cash payments relating to financing 1,314,895 1,178,472
activities
Subtotal of cash outflows of financing 6,016,982 4,556,308
activities
Net cash flows from financing activities 1,678,252 2,016,186
IV. Effect of exchange rate changes on cash -28,875 -15,610
and cash equivalents
V. Net increase in cash and cash equivalents 705,928 -1,673,186
Add: Balance of cash and cash equivalents at 3,668,528 4,771,340
the beginning of the period
VI. Balance of cash and cash equivalents at 4,374,456 3,098,154
the end of the period
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
Cash Flow Statement of the Company
January to March 2008
Unit: RMB'000 (Unaudited)
Items Amounts for Amounts for the
the period corresponding
period of
previous year
I. Cash flows from operating activities:
Cash received from sales of goods, provision 11,037,294 9,711,463
of services
Refund of tax and levy 28,143 -
Other cash received relating to operating 152,363 154,664
activities
Subtotal of cash inflows of operating 11,217,800 9,866,127
activities
Cash paid for goods purchased, services 6,294,726 5,582,382
rendered
Cash paid to or on behalf of employees 1,065,998 826,972
Tax paid 699,669 795,041
Other cash paid in relation to operating 1,104,204 992,384
activities
Subtotal of cash outflows of operating 9,164,597 8,196,779
activities
Net cash flows from operating activities 2,053,203 1,669,348
II. Cash flows from investing activities:
Cash received from investments - -
Cash from investment income - 14,713
Net cash from disposal of fixed assets, 24,559 15,691
intangible assets and other long-term assets
Net cash from disposal of subsidiaries and - -
other business units
Other cash received from investing activities 149,483 13,051
Subtotal of cash inflows of investment 174,042 43,455
activities
Cash paid to purchase of fixed assets, 2,469,311 2,304,763
intangible assets and other long-term assets
Cash paid to investments - 3,032,433
Net cash from subsidiaries and other - -
business units
Cash payments relating to other investments - -
Subtotal of cash outflows of investment 2,469,311 5,337,196
activities
Net cash flows from investing activities -2,295,269 -5,293,741
III. Cash flows from financing activities:
Cash received from investments - -
Cash received from borrowings 7,664,882 6,562,494
Other cash relating to financing activities - -
Subtotal of cash inflows of financing 7,664,882 6,562,494
activities
Cash repaid to amounts borrowed 4,257,492 2,892,369
Cash payments for distribution of dividends, 395,334 464,919
profits or interest expenses
Other cash payments relating to financing 1,314,896 1,178,472
activities
Subtotal of cash outflows of financing 5,967,722 4,535,760
activities
Net cash flows from financing activities 1,697,160 2,026,734
IV. Effect of exchange rate changes on cash -10,159 -1,156
and cash equivalents
V. Net increase in cash and cash equivalents 1,444,935 -1,598,815
Add: Balance of cash and cash equivalents at 1,348,887 2,921,900
the beginning of the period
VI. Balance of cash and cash equivalents 2,793,822 1,323,085
at the end of the period
Person in charge of the Company: Chairman Kong Dong
Person in charge of accounting function: Chief Financial Officer Fan Cheng
Person in charge of accounting department: General Manager of Finance Department
Li Youqiang
II. APPOINTMENT OF CHAIRMAN OF THE SECOND SESSION OF THE BOARD
Mr. Kong Dong was appointed as Chairman of the second session of the Board.
Please see page 46 of the 2007 annual report of the Company for the profile of
Mr. Kong Dong.
III. SALE OF CERTAIN EQUITY INTEREST HELD BY CHINA NATIONAL AVIATION COMPANY
LIMITED
It was approved at the Board Meeting that CNAC, a wholly-owned subsidiary of the
Company, will transfer 100% equity interest held by it in Fly Top Limited, 100%
equity interest held by it in China National Aviation Logistics Company Limited
and 50% equity interest held by it in Jardine Airport Services Limited
(collectively the 'Transaction') to CNACG. The management of the Company was
authorised to handle the related matters including but not limited to
negotiating the Transaction within a price range of RMB748 million to RMB863
million, signing related agreement and obtaining necessary approvals.
CNACG is a wholly-owned subsidiary of China National Aviation Holding Company,
which is a substantial shareholder of the Company, and is therefore a connected
person of the Company as defined under the Hong Kong Listing Rules.
Consequently, the Transaction constitutes a connected transaction of the
Company. The agreement relating to the Transaction is still under negotiation.
The Company will further disclose the details of the Transaction pursuant to
domestic and overseas regulatory rules after the related agreement is signed.
IV. AMENDMENT OF THE ARTICLES OF ASSOCIATION OF THE COMPANY IN RESPECT OF THE
COMPANY'S SHARE CAPITAL STRUCTURE
Since the initial public offering of A shares by the Company in 2006, all the
then issued domestic shares and the foreign shares held by CNACG have been
permitted to be tradable on the Shanghai Stock Exchange and some of which will
become tradable when the relevant lock-up periods expire. Considering that both
the shareholders of A shares and the shareholders of H shares may increase or
decrease their shareholdings in accordance with the relevant laws, which may
change the shareholdings of the Company's major shareholders from time to time,
the Board proposed to amend the Articles of Association of the Company as
follows:
The sixth paragraph of Article 20 of the Articles of Association of the original
draft, which reads:
'The share capital structure after the said additional issuance of H shares
shall be as follows: the Company has a total of 12,251,362,273 ordinary shares,
of which China National Aviation Holding Company holds 4,949,066,567 Domestic
Shares, representing approximately 40.40% of the Company's total share capital;
China National Aviation Corporation (Group) Limited holds 1,380,482,920 Foreign
Shares, representing approximately 11.27% of the Company's total share capital;
Cathay Pacific Airways Limited holds 2,122,472,455 Overseas-Listed Foreign
Shares (H shares), representing approximately 17.34% of the Company's total
share capital; other holders of Overseas-Listed Foreign Shares (H shares) hold
2,283,210,909 shares, representing approximately 18.63% of the Company's total
share capital; other holders of the Domestic Shares hold 1,516,129,422 shares,
representing approximately 12.38% of the Company's total ordinary shares in
issue.'
is hereby amended as follows:
'The current share capital structure of the Company shall be as follows: the
Company has a total of 12,251,362,273 ordinary shares, of which holders of A
shares hold 7,845,678,909 shares, representing approximately 64.04% of the
Company's total issued ordinary shares; holders of H shares hold 4,405,683,364
shares, representing approximately 35.96% of the Company's total issued ordinary
shares.'
According to the Articles of Association of the Company and the relevant laws
and regulations, the proposed amendment is subject to the shareholders' approval
by way of special resolution at the Company's general meeting. Further, the
proposed amendment will become effective after relevant PRC authorities approve
it.
By Order of the Board
Air China Limited
Huang Bin Li Man Kit
Joint Company Secretaries
Beijing, 24 April 2008
As at the date of this announcement, the directors of the Company are Messrs
Kong Dong, Wang Shixiang, Yao Weiting, Ma Xulun, Christopher Dale Pratt,
Chen Nan Lok Philip, Cai Jianjiang, Fan Cheng, Hu Hung Lick, Henry*, Wu Zhipan*,
Zhang Ke* and Jia Kang*.
* Independent non-executive director of the Company
This information is provided by RNS
The company news service from the London Stock Exchange
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