Hainan Airlines has reported a 27% drop in its 2012 full-year net profit to yuan (CNY) 1.9 billion ($306 million).
The Shanghai-listed carrier's total revenue rose by 9.9% to CNY28.9 billion, up from CNY26.3 billion a year ago. Its operating costs, however, also went up by 11% to CNY21.6 billion.
In 2012, Hainan carried 22.6 million passengers, up by 10% from a year ago. Its load factor had a slight 0.2% increase to 84.4%.
Although passenger traffic was strong in the year, the cargo market was weak, says the carrier. It adds that domestic competition among airlines has also intensified, and that the carrier is expecting the construction of a high-speed rail in the country to have an impact on its short-haul routes, as it goes into full swing.
Over the next five years, it has plans to join an alliance to increase its global presence and build its network, says the airline. During this time, it will also focus its operations on a fleet of Boeing 787s, Airbus A330s and Boeing 737-800s.
Flightglobal Pro data shows that Hainan has a fleet of 108 aircraft including A320s, A330s, A340s and 737s, and has 45 aircraft on order, including the C919 and 787-8.