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Aeroflot still pressing to establish single eastern carrier

Aeroflot is still battling to integrate its newly-acquired subsidiary operations into a profitable operation, but insists it is prepared to create a single carrier to serve the country's eastern region.

It has tentatively named the carrier 'DWA', an acronym standing for 'Far Eastern Airlines' but also the Russian word for 'two', a probable reference to Aeroflot's ambitions to set up a second major group operator.

Aeroflot says DWA would ideally use Vladivostok Avia as a platform. It says this would be an "expedient solution" to achieving a strong position in the region.

But during a recent meeting to review capital investment plans for 2013, Aeroflot's board highlighted the "challenge" of effective integration of Vladivostok Avia into the group.

The board says there is a need to improve regional and inter-regional connections in the area and enable better access to Aeroflot's route network as well as that of the SkyTeam alliance.

Aeroflot says it has "confirmed its readiness" to create the single airline in co-operation with the government.

While Aeroflot alone made a $114 million net profit over the first half of 2012 - a 65% fall on the previous year's figure - this was effectively wiped out at group level by the accumulated losses of its subsidiary airlines.

Vladivostok Avia, Rossiya and Orenair generated combined net losses of $108 million over the first six months of this year, says Aeroflot.

Rossiya suffered the heaviest operating losses, $56 million, while Vladivostok Avia's reached $34 million.

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