(Yicai Global) March 29 -- China Southern Airlines plans to make its profitable logistics unit a standalone company and take it public on the Shanghai Stock Exchange in order to focus on its main business, the loss-making Chinese carrier said.
China Southern Air Logistics will still be controlled by China Southern after the spin-off, the Guangzhou-based carrier said yesterday. Although the parent firm’s net profit may be diluted in the short term, the boost to Southern Air Logistics’ coffers and business development capabilities will pay off in the long run, it added.
Southern Air Logistics is China Southern’s main earner. Last year the unit logged net profit of CNY4.6 billion (USD667.9 million) on revenue of CNY21.5 billion, according to China Southern’s 2022 financial report released yesterday.
By contrast, China Southern’s losses nearly tripled, widening by 170 percent, to CNY32.7 billion, and revenue slumped 14.3 percent to CNY87.1 billion (USD12.6 billion).
Founded in 2018, Southern Air Logistics operated a fleet of 15 Boeing 777F freight planes and the cargo business of 879 passenger aircraft as of the end of 2022.
China Southern’s share price [SHA: 600029] closed up 0.8 percent at CNY7.56 (USD1.10) today.
Editor: Kim Taylor