China Eastern Airlines (600115) Q2 2024 earnings summary

Executive summary

• Achieved significant operational recovery in H1 2024, leveraging market rebound and optimizing air network, with notable improvements in international market recovery and service innovation.

• Revenue for H1 2024 reached RMB 64.20 billion, up 29.67% year-over-year, driven by strong recovery in passenger and cargo demand.

• Net loss attributable to shareholders narrowed to RMB -2.77 billion, a significant reduction from RMB -6.26 billion in H1 2023.

• Passenger traffic and cargo volumes both saw robust growth, with international routes leading the recovery.

• Challenges included high aviation fuel costs, intensified domestic competition, and incomplete recovery in some international markets.

Financial highlights

• Total revenue reached ¥64.199 billion, up 29.67% YoY.

• Net loss attributable to the parent company narrowed to ¥-2.768 billion, reducing losses by ¥3.49 billion YoY.

• Gross margin improved by 5.22 percentage points to 2.71%.

• EBITDA/total debt ratio improved to 0.06 (from 0.04 YoY); EBITDA interest coverage at 4.46x.

• Basic and diluted EPS: RMB -0.12 (vs. -0.28 YoY); net assets per share: RMB 1.69.

Outlook and guidance

• Focus for H2 2024 includes maintaining safety, improving business efficiency, deepening service brand construction, promoting precision management, and accelerating reform and innovation.

• H2 2024 expected to see continued recovery in domestic and international air travel, but challenges remain from overcapacity in some domestic markets and uncertain international demand.

• Planned introduction of 36 new aircraft and retirement of 13 in H2 2024; further expansion in 2025.

• Focus on safety, efficiency, cost control, and digital transformation to drive high-quality growth.