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19 Dec 2008 15:12
AIR CHINA LIMITED
(a joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock Code: 753)
Overseas Regulatory Announcement
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This announcement is made pursuant to Rule 13.09 (2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. |
Since 15 October 2008 when Air China Limited (the Company) made a profit warning announcement in relation to operating losses for the third quarter of 2008, 28 October 2008 when the Company announced its results for the third quarter of 2008, and 21 November 2008 when the Company made an announcement regarding its fuel hedging contracts, international crude oil price has continued to fluctuate and decline while the global economic crisis deteriorated. The New York West Texas Intermediate crude oil closing price was US$67.81 per barrel on 31 October 2008 (the average price in October was US$76.52 per barrel) and the closing price was US$54.37 per barrel on 30 November (the average price in November was US$57.44 per barrel). The Company incurred actual loss of US$5,880,000 from settlement of the fuel hedging contracts in November 2008 and fuel acquisition cost at the spot market was saved by approximately US$41,150,000 in that month compared with the budgeted cost.
Due to the continued decline of crude oil price in December 2008, the actual loss from settlement of fuel hedging contracts, which will be calculated based on the average monthly oil price that is to be ascertained, will further increase. Meanwhile, the Company's fuel acquisition cost at the spot market will decrease accordingly.
Under current circumstances, the actual loss from settlement of fuel hedging contracts will not have material adverse effect on the Company's cash flow.
This announcement is made pursuant to Rule 13.09 (2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.
By order of the Board
Air China Limited
Huang Bin Tam Shuit Mui
Joint Company Secretaries
Beijing, PRC, 19 December 2008
As at the date of this announcement, the Directors of the Company are Messrs Kong Dong, Wang Yinxiang, Wang Shixiang, Ma Xulun, Christopher Dale Pratt, Chen Nan Lok, Philip, Cai Jianjiang, Fan Cheng, Hu Hung Lick, Henry*, Wu Zhipan*, Zhang Ke* and Jia Kang*.
* Independent non-executive Directors of the Company
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