Sign In
Last checked at 
13 Mar 2012 08:00
ο»Ώ
HongΒ KongΒ ExchangesΒ andΒ ClearingΒ LimitedΒ andΒ TheΒ StockΒ ExchangeΒ ofΒ HongΒ KongΒ LimitedΒ takeΒ noΒ responsibilityΒ for theΒ contentsΒ ofΒ thisΒ announcement,Β makeΒ noΒ representationΒ asΒ toΒ itsΒ accuracyΒ orΒ completenessΒ andΒ expresslyΒ disclaim anyΒ liabilityΒ whatsoeverΒ forΒ anyΒ lossΒ howsoeverΒ arisingΒ fromΒ orΒ inΒ relianceΒ uponΒ theΒ wholeΒ orΒ anyΒ partΒ ofΒ theΒ contents ofΒ thisΒ announcement.
Β
Β
Β
Β
Β
Β
Β Β Air China Limited
Β
Β
Β
Β
(aΒ jointΒ stockΒ limitedΒ companyΒ incorporatedΒ inΒ theΒ People'sΒ RepublicΒ ofΒ ChinaΒ withΒ limitedΒ liability)
(StockΒ Code:Β 00753)
Β
OVERSEASΒ REGULATORYΒ ANNOUNCEMENT
Β
ThisΒ announcementΒ isΒ publishedΒ pursuantΒ toΒ RuleΒ 13.09(2)Β ofΒ theΒ RulesΒ GoverningΒ theΒ ListingΒ of SecuritiesΒ onΒ TheΒ StockΒ ExchangeΒ ofΒ HongΒ KongΒ Limited.
Β
TheΒ attachmentΒ toΒ thisΒ announcementΒ isΒ theΒ followingΒ announcementΒ of
AirΒ ChinaΒ LimitedΒ publishedΒ onΒ theΒ ShanghaiΒ StockΒ Exchange:
Β
AnnouncementΒ onΒ ImpairmentofΒ AircraftΒ andΒ RelatedΒ Assets
Β
ByΒ orderΒ ofΒ theΒ Board
AirΒ ChinaΒ Limited
RaoΒ Xinyu TamΒ ShuitΒ Mui
JointΒ CompanyΒ Secretaries
Β
Beijing,Β theΒ PRC,Β 12Β MarchΒ 2012
Β
As at the date of this announcement, the directors of the Company are Mr.Β Wang Changshun, Ms. Wang YinxiangΒ , Mr. Cao JianxiongΒ , Mr. Sun YudeΒ , MΒ r. Christopher Dale PrΒ att,Β Mr. Ian Sai Cheung Shiu, Mr. Cai Jianjiang, Mr. Fan Cheng, Mr. FuΒ Yang*, Mr. Li Shuang*, Mr.Β HanΒ Fangming*Β andΒ Mr. Yang Yuzhong*.
Β
* IndependentΒ non-executiveΒ directorΒ ofΒ theΒ Company
StockΒ Code:Β 601111 StockΒ ShortΒ Name:Β AirΒ China No.:Β LinΒ 2012-005
Β
AIRΒ CHINAΒ LIMITED
ANNOUNCEMENTΒ ONΒ IMPAIRMENTOF AIRCRAFTΒ ANDΒ RELATEDΒ ASSETS
Β
Β
The Company and all members of the board of directors hereby warrant the truthfulness, accuracy and completeness of the contents of this announcement and jointly and severally accept full responsibility for any false representations or misleading statements contained in, or material omissionΒ from,Β thisΒ announcement.
Β
Β
InΒ accordanceΒ withΒ theΒ strategicΒ developmentΒ planΒ ofΒ AirΒ ChinaΒ LimitedΒ (theΒ "Company")Β andΒ for the purposesΒ of optimizingΒ fleetΒ structureΒ andΒ improvingΒ theΒ fleet'sΒ overallΒ operatingΒ efficiency, the Company had decided in 2010 to dispose 49Β old model aircraft before the expiration of their normalΒ usefulΒ lives. The Company conducted an impairment testΒ onΒ theΒ 49Β oldΒ modelΒ aircraft in 2010 according to the accounting standards and provided for the impairment of related assets accordingΒ toΒ theΒ resultsΒ ofΒ theΒ test.Β SuchΒ impairmentΒ wasΒ approvedΒ atΒ theΒ seventhΒ meetingΒ ofΒ the third session ofΒ theΒ boardΒ ofΒ directorsΒ (theΒ "Board")Β heldΒ onΒ 24Β MarchΒ 2011Β andΒ wasΒ announced in the China Securities Journal, Shanghai Securities News, Securities Daily and the website of the Shanghai Stock Exchange (www.sse.com.cn) onΒ 25Β MarchΒ 2011.
Β
AsΒ atΒ theΒ endΒ of 2011,Β 33Β (including13Β BoeingΒ 737-300Β aircraft,Β 8Β BoeingΒ 757-200Β aircraft,3 BoeingΒ 767-300Β aircraft andΒ 9Β BoeingΒ 747-400Β aircraft) outΒ ofΒ theΒ 49Β aircraftΒ mentionedΒ above haveΒ notΒ been disposedΒ of. TheΒ sellingΒ prices ofΒ suchΒ 33Β aircraftΒ areΒ expectedΒ toΒ beΒ lowerΒ than thoseΒ previously expectedΒ and Β haveΒ shownΒ signsΒ ofΒ impairment over theΒ impairment providedΒ forΒ in 2010.
Β
InΒ accordance withΒ theΒ "Accounting StandardsΒ forΒ BusinessΒ EnterprisesΒ No.Β 8Β -Β ImpairmentΒ of Assets" andΒ "International FinancialΒ ReportingΒ StandardsΒ No.Β 36Β -Β Impairmentof Assets"Β ofΒ the People's Republic of China, if an indicator of assets impairment exists, such as "the current market priceΒ ofΒ anΒ assetΒ falls, andΒ itsΒ decreaseΒ isΒ obviously higherΒ than the expectedΒ dropΒ overΒ timeΒ or from normal use" and "any evidence in the internal report of an enterprise shows that the economic performance of an asset has been or will be worse than expected", which indicates an asset may be impaired, theΒ recoverableΒ amountΒ ofΒ thatΒ assetΒ shouldΒ beΒ estimated.Β ImpairmentΒ provisionΒ should beΒ madeΒ basedΒ onΒ theΒ difference betweenΒ theΒ recoverableΒ amountΒ ofΒ theΒ assetΒ andΒ itsΒ bookΒ value.
Β
Accordingly, the Company has engaged a third-party professional appraisal firm to evaluate the recoverable amount of the 33Β aircraftΒ mentioned above, the spare engines and the related assets proposedΒ to beΒ disposedΒ of. TheΒ evaluation resultsΒ showedΒ thatΒ theΒ recoverableΒ amountΒ ofΒ partΒ of theΒ abovementioned assetsΒ wereΒ lowerΒ thanΒ theirΒ bookΒ value, andΒ asΒ such,Β theΒ CompanyΒ will,Β for theΒ yearΒ ofΒ 2011, makeΒ impairment provisions forΒ theΒ shortfall betweenΒ the recoverableΒ amount and book value in the amount of RMB1.373 billion, including an impairment provision of RMB65 millionΒ forΒ inventoriesΒ -Β flightΒ equipmentsandΒ anΒ impairmentΒ provisionΒ ofΒ RMB1.308Β billionΒ for fixedΒ assetsΒ -Β aircraft andΒ engines.
In addition,Β Air China Cargo Co., Ltd., a subsidiary of the Company, has also conducted an impairment test for 6 B747-400F aircraft and the related assets proposed to be disposed of. According to the valuation report issued by a third-party appraisal firm, an impairment provision of RMB316Β millionΒ willΒ beΒ made.
Β
Based on the foregoing, the Company will make an aggregated impairment provision of RMB1.689 billion in the consolidated statements for 2011, of which RMB550 million is recognized in the financial statements for the third quarter of 2011 based on estimated calculations and RMB1.139 billionΒ isΒ recognizedΒ forΒ theΒ fourthΒ quarterΒ ofΒ 2011.
Β
At the twenty-second meeting of the third session of the Board held on 12 March 2012, the "Resolution regarding ConsiderationΒ and ApprovalΒ onΒ ProvisionΒ forΒ ImpairmentofΒ the AircraftΒ and Related Assets Proposed toΒ be DisposedΒ of"Β wasΒ passedΒ andΒ theΒ CompanyΒ wasΒ approvedΒ toΒ makeΒ an impairment provisionΒ ofΒ RMB1.373 billion inΒ 2011Β forΒ theΒ aircraftΒ andΒ relatedΒ assetsΒ proposedΒ to be disposed of, with an aggregated impairment provision of RMB1.689 billion in the consolidated statementsΒ forΒ 2011.
Β
TheΒ CompanyΒ believesΒ thatΒ theΒ impairmentΒ provisionsΒ madeΒ forΒ theΒ aboveΒ assetsΒ wouldΒ notΒ haveΒ anyΒ significant Β impactΒ onΒ theΒ financialpositionΒ andΒ operatingΒ resultsΒ ofΒ theΒ GroupΒ forΒ theΒ yearΒ ofΒ 2011.
Β
ByΒ orderΒ ofΒ theΒ Board
RaoΒ Xinyu
BoardΒ Secretary
Β
Beijing,Β theΒ PRC,Β 12Β MarchΒ 2012
Follow the stocks
