China Eastern Airlines moves into the black in 2007

BEIJING, April 15 (Xinhua) -- China Eastern Airlines (CEA), one of the country's three major carriers, announced on Tuesday that it had turned a profit of 586 million yuan (83.7 billion U.S. dollars) in 2007, reversing the previous year's 3 billion yuan loss.

CEA said that last year's revenue rose 14 percent year-on-year to 43.53 billion yuan. Of the total, 41.77 billion yuan, or 96 percent, was earned from air transport business.

Revenue from domestic passenger services was 23.91 billion yuan, up 19 percent, while international passenger revenue was 12.31 billion yuan, up 20 percent. The remainder of revenue came from cargo services.

Last year, CEA achieved 155 million yuan in returns on investment, up from 67.91 million yuan in 2006.

Operating costs rose 7 percent to 37.65 billion yuan. Of the total, fuel costs accounted for 15.12 billion yuan, or 40.9 percent, up 11.69 percentage points from 2006.

In 2008, the company has forecast that it will carry 42.95 million passengers and 1.07 million tons of cargo.

This year, CEA will buy eight A320 aircraft, five A321s, one A330-200, three A330-300s, one B737-700 and one B737-800.

The board has approved a short-term bond issue of 1.4 billion yuan.

According to the General Administration of Civil Aviation, CEA ranked first last year in on-time performance among the three domestic airline giants. The other two major carriers were Air China and China Southern Airlines.

CEA is seeking strategic investors to make its air transport business more competitive.

It rejected a proposed alliance with China National Aviation Corp. (Group), the parent of Air China, on Feb. 26. Analysts said that move could close the door on any alliance between Shanghai-based CEA and Air China, the country's third and second largest airlines, respectively, by fleet size. China Southern Airlines has the largest fleet.

On Jan. 8, China National Aviation Corp. blocked CEA's proposed sale of 1.88 billion H shares, or a 24 percent stake, to Singapore Airlines and Lentor Investments, a unit of Singapore government investment arm Temasek Holdings.