[Huachuang Transportation & Performance Review] Air China: Full-year 2025 net profit attributable to parent company -1.77 billion, short-term oil prices under pressure, medium-term still optimistic about supply and demand elasticity

（Source: Huachuang Transportation）

The company releases its 2025 annual report:

1. Financial data:

1）2025: Revenue was 171.48 billion, year over year +2.9%; net profit attributable to shareholders -1.77 billion, compared with -0.24 billion in 2024; non-recurring profit/loss -2.48 billion, compared with -2.54 billion in 2024; operating profit -2.05 billion, narrowing losses by 1.38 billion year over year. In 2025, full-year FX gains were 0.33 billion.

2）2025Q4: Revenue was 41.66 billion, year over year +8.1%; net profit attributable to shareholders -3.64 billion, compared with -1.60 billion in 2024Q4; non-recurring profit/loss -4.13 billion, compared with -2.97 billion in 2024Q4. Operating profit -3.27 billion, narrowing losses by 0.99 billion year over year. Q4 estimated FX gains were 0.08 billion.

3）Other income: In 2025, other income totaled 4.52 billion, year over year +5.2%; in Q4, other income totaled 1.00 billion, year over year -0.9%.

4）Income tax expense in 2025 was 1.93 billion, with income tax deferred-related impacts; year over year increased by 1.1 billion.

2. Operating data:

1）2025: ASK increased 3.2% year over year, RPK increased 5.9% year over year; passenger load factor was 81.9%, up 2.0 percentage points year over year.

2）2025Q4: ASK increased 4.4% year over year, RPK increased 9.6% year over year; passenger load factor was 83.6%, up 3.9 percentage points year over year.

3. Revenue level:

1）2025: Estimated passenger-kilometer passenger revenue was 0.514 yuan, down 3.6% year over year; seat-kilometer revenue was 0.421 yuan, down 1.2% year over year.

2）2025Q4: Estimated passenger-kilometer passenger revenue was 0.482 yuan, down 0.4% year over year; seat-kilometer revenue was 0.403 yuan, up 4.5% year over year.

4. Cost and expenses:

1）2025 operating costs were 162.65 billion, up 2.8% year over year. During the period, domestic oil price-assisted consolidated mining and coal-related costs decreased 9.4% year over year; aircraft fuel costs were 50.0 billion, down 6.8% year over year. Less oil costs were 112.6 billion, up 7.8% year over year. Cost per seat-kilometer was 0.44 yuan, down 0.4% year over year; less oil cost per seat-kilometer was 0.31 yuan, up 4.4% year over year.

2）2025Q4 operating costs were 41.99 billion, up 9.2% year over year. During the period, domestic oil price-assisted consolidated mining and coal-related costs increased 1.4% year over year; estimated aircraft fuel costs were 12.4 billion, up 3.3% year over year. Less oil costs were 29.6 billion, up 11.9% year over year. Cost per seat-kilometer was 0.46 yuan, up 4.6% year over year; less oil cost per seat-kilometer was 0.32 yuan, up 7.2% year over year.

3）In 2025, total three-fee expenses combined (excluding FX) were 17.96 billion, down 2.6% year over year; the three-fee ratio excluding FX was 10.5%. In 2025Q4, total three-fee expenses combined (excluding FX) were 4.68 billion, down 5.4% year over year; the three-fee ratio excluding FX was 11.2% (Note: not including R&D expenses).

5. Fleet introductions: Net increase in aircraft for 2026-2028 is expected to be 20 units, 49 units, and 59 units, respectively; corresponding growth rates are 2.1%, 5.0%, and 5.7%, respectively.

6. Investment recommendation:

Considering the recent level of oil prices, we expect that 2026-2028 will achieve net profit attributable to shareholders of 22, 87, and 13.8B, respectively, corresponding to PE ratios of 54, 14, and 9 times. In the short term, the aviation industry is affected by rising oil prices; in the medium-to-long term, supply-side constraints remain hard-core. High load factors are expected to drive continued release of pricing elasticity. We continue to emphasize the “Recommended” rating.

Risk warnings: a significant economic downturn, a sharp rise in oil prices, and a significant depreciation of the exchange rate.

For specific content such as the investment recommendation, please refer to the report published on March 31, 2026 by the Huachuang Securities Research Institute: “China National Aviation: 2025 full-year net profit attributable to shareholders of -1.77 billion; short-term oil price pressure, but still positive on supply-demand elasticity in the medium term.”

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This material is from research reports already published by the Huachuang Securities Research Institute. If any ambiguity arises from the excerpting of the report, the complete content of the report as of the date of its publication shall prevail. Please note that this material only represents the judgment made on the date of publication of the report. The relevant analytical views and forecasts may be changed in the absence of notice, based on the research reports subsequently published by the Huachuang Securities Research Institute. Other business departments or affiliated institutions of Huachuang Securities may independently make investment decisions that are inconsistent with the opinions or recommendations stated in this material. The prices, values, and revenues of the securities or financial instruments referred to in this material may rise or fall; past performance should not be used as an indication or guarantee of future performance. This material is provided solely for the subscribers’ reference. It is not, and should not be, regarded as an offer or solicitation to sell, buy, or subscribe for securities or other financial instruments. Subscribers should not rely solely on the information in this material to replace their own independent judgments; they should make their own investment decisions and bear their own investment risks. Huachuang Securities does not assume any responsibility for any direct or indirect losses arising from or related to the information used in this material, or for any other losses related thereto.

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