TAIWAN'S CHINA Aviation Development Foundation (CADF) is to sell around 16% of its holding in China Airlines (CAL) to private investors. The sale will reduce CADF's stake in the carrier to 62%. It also plans to launch a rights issue of 200 million shares. The issue is expected to raise NT$7 billion ($260 million), which will help towards financing the eight Boeing 747-400s ordered in May.
CAL came close to trebling net profits for 1995, on the back of strong passenger-traffic growth, marking an early recovery from the setbacks it experienced in 1994.
Sales totalled NT$47 billion, up by 9.2% on 1994 figures, when the airline suffered a major financial setback from the Nagoya Airbus A300-600R crash and was hit by the slump in Taiwan's tourist traffic to mainland China via Hong Kong. The airline's net profits came in at over NT$1.2 billion for 1995, which were up strongly on 1994 returns, but which are still lagging behind the NT$3 billion or more profit which the group was making in the early 1990s.
Passenger revenues leaped by 12%, running ahead of a 10% rise in traffic. Passenger numbers came close to 6.5 million. Cargo traffic also surged by nearly 15%, but revenues grew by only 4.5% as declining yields took their toll.
CAL has taken a 15% stake in the new CLK Airport Ground Handling company, which has just been awarded a ten-year licence to operate at Hong Kong's replacement airport at Chek Lap Kok. Jardine Airport Services holds 80%, and a group of unidentified European airline investors have the remaining 5%.
Source: Flight International
