China Southern has record profit on yuan, focus on higher fares

China Southern Airlines said profit jumped to a record on the back of a stronger yuan and as the carrier focused on profitable domestic routes. Net income rose 18% to CNY5.96b (US$950m) last year while revenue rose 11% to CNY127b, the airline said Monday. A strengthening yuan provided tailwind as an appreciating local currency makes it less expensive to repay dollar-denominated debt raised to pay for aircraft. The yuan rose 6.7% against the greenback in 2017. After adding too many direct flights to destinations including Paris, Sydney and New York, the country’s top 3 govt-controlled carriers are now directing their efforts on higher ticket prices for inland flights amid a boom in travel. The air-safety regulator’s caps on flight slots also led to higher fares and slower decline in passenger yields. <br/>