FIRST QUARTERLY REPORT OF 2022

RNS Number : 8592J

Air China Ld

29 April 2022

 

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

中

AIR CHINA LIMITED

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 00753)

FIRST QUARTERLY REPORT OF 2022

This announcement is made pursuant to Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule 13.09 and Rule 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The board of directors (the "Board") of Air China Limited (the "Company") held a meeting of the Board on 28 April 2022 and passed the resolution approving the first quarterly report of 2022 of the Company for the period ended 31 March 2022 (the "Reporting Period" or "Period") prepared in accordance with the PRC Accounting Standards for Business Enterprises.

IMPORTANT NOTICE

The Board and the supervisory committee of the Company together with the directors, supervisors and the senior management of the Company guarantee that the contents of the quarterly report are true, accurate and complete and do not contain any false representation, misleading statement or material omission, and shall jointly and severally accept legal liability.

The person in charge of the Company, person in charge of accounting function and person in charge of accounting department (accounting superintendent) hereby guarantee that the financial statements set out in this quarterly report are true, accurate and complete.

Whether the first quarterly report of the Company is audited

Yes           X No

I.  MAJOR FINANCIAL DATA

(1)  MAJOR ACCOUNTING DATA AND FINANCIAL INDICATORS

Unit: RMB'000

Items	During the ReportingPeriod	Increase/decrease as compared to the same period of the previous year (%)
Revenue	12,917,577	-11.41
Net profit attributable to shareholders of the listed company	-8,899,923	N/A
Netprofitattributabletoshareholders of the listed company after deducting non- recurring profits and losses	-8,962,346	N/A
Netcashflowsfromoperatingactivities	-7,658,829	N/A
Basicearningspershare(RMBpershare)	-0.65	N/A
Dilutedearningspershare(RMBpershare)	N/A	N/A
Weightedaveragereturnonnetassets(%)	-15.64	Decreasedby 7.31percentage points

	Attheendofthe Reporting Period	Attheendofthe previous year	Increase/decrease at the end of the ReportingPeriod as compared to the end of the previous year (%)
Total assets	293,138,034	298,415,152	- 1.77
Owners' equity attributable to shareholders of the listed company	52,375,762	61,402,519	- 14.70

(2)  Items and amount of non-recurring profits and losses

Unit: RMB'000

Items	Amount for thePeriod
Gainsorlossesondisposalofnon-currentassets	-4,081
Governmentsubsidiesrecordedintheincomestatementforthecurrent period (excluding those closely related to the Company's normalbusinessandcontinuouslyentitledtoinfixedamountsorquotasin accordancewiththerequirementsofthestatepolicy)	73,932
Gainorlossfromchangeinfairvaluebyholdingtradablefinancial assets, derivative financial assets, tradable financial liabilities andderivative financial liabilities, and investment income from disposal oftradable financial assets, derivative financial assets, tradable financialliabilitiesandderivativefinancialliabilitiesaswellasotherdebt investments, excluding the effective hedging businesses related with thenormal operations of the Company	-657
Switch-back of impairment provisions of accounts receivable andcontractassetsthathaveundergoneimpairmenttestalone	2,892
Othernon-operatingincomeandexpensesbesidestheaboveitems	14,539
Less:Effectofincometax	13,589
Effectofnon-controllinginterests(aftertax)	10,613
Total	62,423

Explanation of non-recurring profits and losses items listed in the "Interpretative Announcement for Information Disclosure of Companies That Issue Securities to the Public

No.1 - Non-recurring Profits and Losses" ( 《

第 1 號 ) which are defined as recurring profits and losses items

Applicable            X Not applicable

(3)  Particulars of, and reasons for, changes in major accounting data and financial indicators

3   Applicable   Not applicable

Items	Percentage of Change(%)	MajorReasons
Net profit attributable to shareholders of the listed company	N/A	Mainly due to the combined effects of thedomesticsporadicoutbreakof the pandemic and the rising aviation fuel price
Net profit attributable to shareholdersofthelisted company after deducting non-recurringprofitsand losses	N/A	Mainly due to the combined effects of thedomesticsporadicoutbreakof the pandemic and the rising aviation fuel price
Net cash flows from operating activities	N/A	Mainlyduetotheeffectofthe decrease of deposits received by the finance company under the Group during the Period
Basic earnings per share (RMB per share)	N/A	Mainly due to the combined effects of thedomesticsporadicoutbreakof the pandemic and the rising aviation fuel price

II.  INFORMATION OF SHAREHOLDERS

(1)  Total number of holders of ordinary shares, the number of holders of preference shares with restored voting rights and the particulars of the top 10 shareholders

Unit: share

Total number of holders of ordinary shares asattheendoftheReportingPeriod

111,662 accounts, of which 3,022 wereregisteredshareholdersofHshares

Total number of holders of preference shares with restored voting rights as attheendoftheReportingPeriod (account,ifany)

/

Particulars of the top 10 shareholders
Name of shareholder	Nature of shareholder	Number of sharesheld	Shareholding percentage	Number ofshares heldsubject toselling restrictions	Shares pledged, marked or frozen
					Status	Number
			(%)
China National Aviation Holding CorporationLimited	State-owned legal person	5,952,236,697	40.98	0	Frozen	127,445,536
Cathay Pacific Airways Limited	Foreign legal person	2,633,725,455	18.13	0	Nil	0
HKSCC NOMINEES LIMITED	Foreign legal person	1,688,204,365	11.62	0	Nil	0
China National Aviation Corporation (Group)Limited	Foreign legal person	1,556,334,920	10.72	0	Frozen	36,454,464

Particulars of the top 10 shareholders
Name of shareholder	Nature of shareholder	Number of sharesheld	Shareholding percentage	Number ofshares heldsubject toselling restrictions	Shares pledged, marked or frozen
					Status	Number
			(%)
China National Aviation Fuel Group Corporation	State-owned legal person	324,541,025	2.23	0	Nil	0
China Securities Finance Corporation Limited	State-owned legal person	311,302,365	2.14	0	Nil	0
Hong Kong Securities Clearing Company Ltd.	Foreign legal person	82,153,262	0.57	0	Nil	0
Agricultural Bank of China Limited - GF Balanced Preferred Hybrid Securities Investment Fund ( 中 - 廣 合 )	Domestic non-state-owned legalperson	58,402,229	0.40	0	Nil	0
Bank of China - YFD Stable Income Bond InvestmentFund( 中 - 易 券 )	Domestic non-state-owned legalperson	42,570,400	0.29	0	Nil	0
Industrial Bank Co., Ltd. - GF Stable Preferred Six-MonthHoldingPeriodHybridSecurities Investment Fund ( 興 - 廣 穩 )	Domestic non-state-owned legalperson	32,184,214	0.22	0	Nil	0

Particulars of the top 10 shareholders not subject to selling restrictions
Name of shareholder	Number of tradable shares held not subject tosellingrestrictions	Class and number of shares
		Class	Number
China National Aviation Holding Corporation Limited	5,952,236,697	RMB ordinary shares	5,952,236,697
Cathay Pacific Airways Limited	2,633,725,455	Overseas listed foreign shares	2,633,725,455
HKSCC NOMINEES LIMITED	1,688,204,365	Overseas listed foreign shares	1,688,204,365
China National Aviation Corporation (Group) Limited	1,556,334,920	RMB ordinary shares	1,332,482,920
		Overseas listed foreign shares	223,852,000
China National Aviation Fuel Group Corporation	324,541,025	RMB ordinary shares	324,541,025
China Securities Finance Corporation Limited	311,302,365	RMB ordinary shares	311,302,365
Hong Kong Securities Clearing Company Ltd.	82,153,262	RMB ordinary shares	82,153,262
Agricultural Bank of China Limited - GF Balanced Preferred Hybrid Securities InvestmentFund ( 中 - 廣 )	58,402,229	RMB ordinary shares	58,402,229
Bank of China - YFD Stable Income Bond Investment Fund ( 中 - 易 )	42,570,400	RMB ordinary shares	42,570,400
Industrial Bank Co., Ltd. - GF Stable Preferred Six-Month Holding Period HybridSecuritiesInvestmentFund( 興 - 廣 六 )	32,184,214	RMB ordinary shares	32,184,214
Explanation on connected relationship or action in concert among the above shareholders	China National Aviation Corporation (Group) Limited is a wholly-owned subsidiary of China NationalAviationHoldingCorporationLimited.Accordingly,ChinaNationalAviationHolding CorporationLimitedisdirectlyandindirectlyinterestedin51.70%ofthesharesoftheCompany.
Explanation on the participation of the top 10 shareholders and the top 10 shareholders not subject to selling restrictions in margin financing and securitieslendingaswellasmarginandsecuritiesrefinancingbusiness(if any)	Nil

1.  HKSCC NOMINEES LIMITED is a subsidiary of The Stock Exchange of Hong Kong Limited and its principal business is acting as nominee for and on behalf of other corporate shareholders or individual shareholders. The 1,688,204,365 H shares held by it in the Company do not include the 166,852,000 shares held by it as nominee of China National Aviation Corporation (Group) Limited.

2.  According to the "Implementation Measures on Partial Transfer of State-owned Shares to the National Social Security Fund in the Domestic Securities Market" (Cai Qi [2009] No. 94) ( 《 ( 財 [2009]94 號 )) and the Notice ([2009] No. 63) jointly issued by the Ministry of Finance, the SASAC, China Securities Regulatory Commission and the National Council for Social Security Fund, 127,445,536 and 36,454,464 shares held by China National Aviation Holding Corporation Limited, the controlling shareholder of the Company, and China National Aviation Corporation (Group) Limited respectively are frozen at present.

III.  OTHER ALERTS

Other important information that needs to be brought to the attention of investors regarding the Company's operations during the Reporting Period

Applicable           X Not applicable

IV.  QUARTERLY FINANCIAL STATEMENTS

(1)  Type of audit opinion

Applicable           X Not applicable

(2)  Financial statements

CONSOLIDATED BALANCE SHEET

31 March 2022

Prepared by Air China Limited

Unit: RMB'000 (Unaudited)

Items	31March 2022	31December 2021
CURRENTASSETS:
Cashandbankbalance	11,953,983	16,709,664
Provisionsonpayables
Contributionsmade
Financialassetsheld-for-trading	3,500	4,157
Derivativefinancialassets
Billsreceivable	1,193	3,591
Accountsreceivable	1,565,549	2,991,037
Receivablesfinancing
Prepayments	598,670	440,274
Premiumreceivable
Receivablesonreinsurance
Provisionsforreinsurancecontracts
Otherreceivables	3,466,217	3,191,247
Including:Interestreceivable
Dividendreceivable
Purchaseoffinancialassetsresold
Inventories	2,611,116	2,050,282
Contractassets
Held-for-saleassets	111,502	333,884
Non-currentassetsduewithinayear
Othercurrentassets	5,703,688	4,672,592
Totalcurrentassets	26,015,418	30,396,728

Items	31March 2022	31December 2021
NON-CURRENTASSETS:
Loansandadvances
Debtinvestments
Otherdebtinvestments	1,329,109	1,373,634
Long-termreceivables	552,506	574,646
Long-termequityinvestments	11,125,478	12,081,091
Investmentsinotherequityinstruments	157,396	178,366
Othernon-currentfinancialassets
Investmentproperties	127,210	128,782
Fixedassets	83,721,874	85,009,447
Constructioninprogress	33,915,102	34,862,651
Biologicalassetsforproduction
Oilandgasassets
Right-of-useassets	121,067,139	119,213,535
Intangibleassets	3,502,815	3,544,175
Developmentexpenses
Goodwill	1,102,185	1,102,185
Long-termdeferredexpenses	234,267	249,358
Deferredtaxassets	10,287,535	9,700,554
Othernon-currentassets
Totalnon-currentassets	267,122,616	268,018,424
Totalassets	293,138,034	298,415,152
CURRENTLIABILITIES:
Short-termloans	19,442,120	22,001,916
Short-termfinancingbondspayable	11,880,363	12,332,635
Borrowingsfromcentralbank
Contributionsreceived
Financialliabilitiesheld-for-trading
Derivativefinancialliabilities
Billspayable	377,793	199,276
Accountspayable	14,405,302	13,307,360
Airtrafficliabilities	1,926,792	2,116,028
Receiptsinadvance
Contractliabilities	1,705,498	1,479,717
Saleoffinancialassetsrepurchased
Depositsfromclientsandplacementsfromotherbanks
Brokeragepayable
Underwritingfeespayable
Employeecompensationspayable	2,776,794	3,502,384
Taxespayable	138,485	166,085
Otherpayables	16,195,803	17,239,846
Including:Interestpayable
Dividendpayable
Feesandcommissionspayable
Amountspayableonreinsurance
Held-for-saleliabilities
Non-currentliabilitiesduewithinayear	24,080,838	19,070,477
Othercurrentliabilities
Totalcurrentliabilities	92,929,788	91,415,724

Items	31March 2022	31December 2021
NON-CURRENTLIABILITIES:
Reservesoninsurancecontracts
Long-termloans	48,114,323	43,620,468
Debenturespayable	7,492,253	9,499,579
Including:Preferenceshares
Perpetualbonds
Leaseliabilities	77,056,885	76,347,051
Long-termpayables	5,749,470	5,656,909
Long-termemployeecompensationpayables	220,736	218,336
Accruedliabilities	3,136,799	3,147,357
Deferredincome	533,592	544,383
Deferredtaxliabilities	326,954	328,063
Othernon-currentliabilities	1,721,906	1,772,209
Totalnon-currentliabilities	144,352,918	141,134,355
Totalliabilities	237,282,706	232,550,079
OWNERS'EQUITY (ORSHAREHOLDERS'EQUITY):
Paid-upcapital(orsharecapital)	14,524,815	14,524,815
Otherequityinstruments
Including:Preferenceshares
Perpetualbonds
Capitalreserve	26,270,841	26,270,841
Less:Treasuryshares
Othercomprehensiveincome	-532,143	-405,309
Specialreserves
Surplusreserves	11,564,287	11,564,287
Generalriskprovisions	131,916	131,916
Retainedearnings	416,046	9,315,969
Total owners' equity (or shareholders' equity) attributable to the parent company	52,375,762	61,402,519
Non-controllinginterests	3,479,566	4,462,554
Totalowners'equity(orshareholders'equity)	55,855,328	65,865,073
Total liabilities and owners' equity (or shareholders' equity)	293,138,034	298,415,152

Person in charge of the Company: Mr. Song Zhiyong Person in charge of accounting function: Mr. Xiao Feng

Person in charge of accounting department: Mr. Zhan Zhong

CONSOLIDATED INCOME STATEMENT

January to March 2022

Prepared by Air China Limited

Unit: RMB'000 (Unaudited)

Items	First quarter of 2022	First quarter of 2021
I.   Totalrevenuefromoperations	12,917,577	14,580,678
Including: Operating income	12,917,577	14,580,678
Interest income
Premium earned
Fees and commission income
II.   Totaloperatingcost	23,144,688	23,098,558
Including: Operating costs	19,688,533	19,241,297
Interest expenses
Fees and commission expenses
Returned premium
Net reimbursement paid
Net amounts of provisions on insurance obligations drawn
Bonus paid on insurance policy
Reinsurance premium
Taxes and other levies	52,195	58,856
Selling expenses	1,048,349	1,095,861
General and administrative expenses	1,066,408	1,056,567
R&D expenses	38,099	30,249
Finance expenses	1,251,104	1,615,728
Including: Interest expenses	1,500,782	1,313,417
Interest income	29,366	8,188
Add:   Otherincome	613,591	913,601
Investment income (loss is represented by "-" sign)	- 842,440	- 1,047,673
Including: Share of profits of associates and joint ventures	- 853,876	- 1,062,546
Gains on derecognition of financial assets measured at amortised cost
Exchange gains (loss is represented by "-" sign)
Gains from net exposure to hedging (loss is represented by "-" sign)
Gains from changes in fair value (loss is represented by "-" sign)	- 657
Impairment loss of credit (loss is represented by "-" sign)	4,948	- 5,228
Impairment loss of assets (loss is represented by "-" sign)
Gains fromdisposalofassets(lossisrepresentedby"-"sign)	1,193	- 914

Items	First quarter of 2022	First quarter of 2021
III.   Profitfromoperations(lossisrepresentedby"-"sign)	- 10,450,476	- 8,658,094
Add: Non-operating income	27,255	27,204
Less: Non-operating expenses	17,989	7,119
IV.   Totalprofit(totallossisrepresentedby"-"sign)	- 10,441,210	- 8,638,009
Less: Income tax expenses	- 569,551	- 1,690,959
V.   Netprofit(netlossisrepresentedby"-"sign)	- 9,871,659	- 6,947,050
(I)   Classified by continuity of operations
1.   Net profit from continuing operations (net loss is represented by "-" sign)	- 9,871,659	- 6,947,050
2.   Net profit from discontinued operation (net loss is represented by "-" sign)
(II) Classified by ownership
1.   Net profits attributable to shareholders of the parent company (net loss is represented by "-" sign)	- 8,899,923	- 6,207,790
2.   Profit or loss attributable to non-controlling interests (net loss is represented by "-" sign)	- 971,736	- 739,260
VI.   Othercomprehensiveincomeaftertax,net	- 138,086	82,705
(I) Other comprehensive income after tax attributable to owners of the parent company, net	- 126,834	89,375
1.   Other comprehensive income that cannot be subsequently reclassifiedtoprofitorloss	- 8,021	- 1,854
(1) Changes arising on remeasurement of defined benefit plans
(2) Other comprehensive income accounted for using the equity method that cannot be reclassified to profit or loss
(3) Change in fair value of investments in other equity instruments	- 8,021	- 1,854
(4) Change infair value ofown credit riskof the Company
2.   Other comprehensive income that will be reclassified to profit or loss	- 118,813	91,229
(1) Other comprehensive income accounted for using the equity method that may be reclassified to profit or loss
(2) Change infair value of other debt investments		- 1,945
(3) Amount of financial assets reclassified into other comprehensive income
(4) Provisions for credit impairment of other debt investments		- 2,387
(5) Reserve for cash flow hedging
(6) Exchange difference on translation of financial statements in foreign currency	- 118,813	95,561
(7) Others
(II) Other comprehensive income after tax attributable to non-controlling interests, net	- 11,252	- 6,670

Items	First quarter of 2022	First quarter of 2021
VII.   Totalcomprehensiveincome	- 10,009,745	- 6,864,345
(I) Total comprehensive income attributable to owners of the parent company	- 9,026,757	- 6,118,415
(II) Total comprehensive income attributable to non-controlling interests	- 982,988	- 745,930
VIII. Earnings per share:
(I)   Basic earnings pershare (RMB pershare)	- 0.65	- 0.45
(II) Diluted earnings per share (RMB per share)	N/A	N/A

For business combination under common control during the Period, the net profit of merged party before the business combination is Nil, and the net profit of the merged party for the last period is Nil.

Person in charge of the Company: Mr. Song Zhiyong Person in charge of accounting function: Mr. Xiao Feng

Person in charge of accounting department: Mr. Zhan Zhong

CONSOLIDATED CASH FLOW STATEMENT

January to March 2022

Prepared by Air China Limited

Unit: RMB'000 (Unaudited)

Items	First quarter of 2022	First quarter of 2021
I.   Cashflowsfromoperatingactivities:
Cash received from sales of goods and provision of services	14,657,731	14,380,541
Net increase in deposits from clients and placements from banks
Net increase in borrowings from central bank
Net increase in contributions received from 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
Cash received from interest, fees and commission
Net increase in contributions received
Net increase in cash from repurchase operations
Net cash receipt from securities trading as agent
Refund of taxes and levies	9,761	4,636
Other cash received relating to operating activities	1,204,029	1,624,412
Subtotal of cash inflows of operating activities	15,871,521	16,009,589
Cash paid for goods purchased and services received	9,480,709	8,587,763
Net increase in loans and advances to clients
Net increase in deposits in central bank and other banks
Cash paid in respect of claims under original insurance contracts
Net increase in contributions made
Cash paid for interest, fees andcommissions
Cash paid for bonus paid on insurance policy
Cash paidtooronbehalfofemployees	6,550,937	6,584,075
Taxes and levies paid	236,815	266,475
Other cash paid relating to operating activities	7,261,889	1,825,572
Subtotal of cash outflows from operating activities	23,530,350	17,263,885
Net cash flows from operating activities	- 7,658,829	- 1,254,296

Items	First quarter of 2022	First quarter of 2021
II.   Cashflowsfrominvestingactivities:
Cash received from sale and redemption of investments	30,061	722,905
Cash received from investment income	22,064	291
Net cash proceeds from disposal of fixed assets, intangible assets and other long-term assets	233,921	8,251
Net cash proceeds from disposal of subsidiaries and other business units
Other cash received relating to investing activities	76,675	31,118
Subtotal of cash inflows from investing activities	362,721	762,565
Cash paid for purchase and construction of fixed assets, intangible assets and other long-term assets	1,466,844	562,481
Cash paid for investments	794,343	50,000
Net increase in secured loans
Net cash payments for acquisition of subsidiaries and other business units
Other cash paid relating to investing activities	1,554	6,758
Subtotal of cash outflows from investing activities	2,262,741	619,239
Net cash flows from investing activities	- 1,900,020	143,326
III. Cash flows from financing activities:
Cash received from issuance of debentures	5,750,000	700,000
Cash received from capital injection		490,148
Including: Cash received from capital injection of non-controlling shareholders in subsidiaries		490,148
Cash received from borrowings	15,029,966	13,650,876
Other cash received relating to financing activities
Subtotal of cash inflows from financing activities	20,779,966	14,841,024
Cash paid for repayment of borrowings	7,581,824	4,219,254
Cash paid for repayment of debentures	3,250,000	1,000,000
Cash paid for distribution of dividends, profits or paymentofinterestexpenses	1,588,383	1,564,579
Including: Dividends and profits paid to non-controlling shareholders by subsidiaries
Other cash paid relating to financing activities	3,516,104	3,616,317
Subtotal of cash outflows from financing activities	15,936,311	10,400,150
Net cash flows from financing activities	4,843,655	4,440,874

Items	First quarter of 2022	First quarter of 2021
IV.   Effect of exchange rate changes on cash and cashequivalents	- 7,693	23,666
V.   Netincreaseincashandcash equivalents	- 4,722,887	3,353,570
Add: Balance of cash and cash equivalents as at the beginning of the Period	15,934,713	5,837,998
VI.   Balanceofcashandcashequivalentsasattheendof the Period	11,211,826	9,191,568

Person in charge of the Company: Mr. Song Zhiyong Person in charge of accounting function: Mr. Xiao Feng

Person in charge of accounting department: Mr. Zhan Zhong

Particulars in relation to adjustments made to the financial statements as at the beginning of the year for the initial implementation of New Accounting Standards since 2022

Applicable            X Not applicable

By Order of the Board

Air China Limited

 Huang Bin  Huen Ho Yin

Joint Company Secretaries

Beijing, the PRC, 28 April 2022

As at the date of this announcement, the directors of the Company are Mr. Song Zhiyong, Mr. Ma Chongxian, Mr. Feng Gang, Mr. Patrick Healy, Mr. Li Fushen*, Mr. He Yun*, Mr. Xu Junxin* and Ms. Winnie Tam Wan-chi*.

*   Independent non-executive director of the Company

 

END

 

 

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