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Presentation Team
Chairman
CFO
SVP & Company Secretary
Acting Director General-Commercial Steering Committee
SVP – Planning & Development Division
SVP – Finance Division
• Mr. Wang Changshun
• Mr. Xiao Lixin
• Mr. Xie Bing
• Mr. Luo Laijun
• Mr. Wu Rongxin
• Mr. Yang Bin
2
Business Overview & Operational Highlights
2016 Financial Highlights
Development Outlook
safe flight in 2016
2.375 mn hourssafe flight accumulated
18.095 mn hoursgeneral aviation
12,312 hours
17 years of aviation safety
22 years of aviation security
Best Safety Records among Chinese airlines
Safety is our first priority
Network Hub1
Marketing 2
E-commerce3
Product Service4
Key Business Highlights
5
Network Hub1
4.65mn transit passengers
Beijing Hub
Key hub for profitable routes
Urumqi Hub
One Belt One Road strategy
Guangzhou
Hub
Major hub for expansion
6
New Routes
Guangzhou Toronto
Guangzhou Adelaide
Shenzhen Sydney
Shenzhen Wuhan Dubai
Xiamen Melbourne
Xiamen Vancouver
Xiamen Shenzhen Seattle
3,45mn international transit passengers
782,000 transit passengers through the Sixth Freedom Traffic Right
• Optimize flight schedules and passenger load factor
1
2• Utilize the advantage of
scale and grasped the peak demand
• Promote value-added products
• Members’ Day theme activities
• Excel in “95539” Customer Service Center
• Expand key and global account business
passenger load factor
Auxiliary income RMB 550 mn
179.1%
97.47%customer satisfaction
rate reached
2 Marketing
3
4
7
19.9%Sky Pearl Member
RMB 30.1 mn
And consecutive profits for the international segment
Internet+E-commerce
Strategy
China Southern E Travel Platformonline services
(e.g. Boarding gate upgrade, refund insurance, airport guidance)
97.4%
customer service points
70+
306+
Integrated with internet services
Airline in ChinaJoined 1st
“Integrated Transportation Traveling Big Data Cloud Platform”
Cooperated With Baidu
Build E Travel platform
Social media marketingE-commerce marketing
Online direct-sales
57.6% RMB 28.8 bn
Mobile terminal sales
142.3% RMB 4.86 bn
Social media sales
262.3% RMB 550 mn
42.7%To total sales
Direct sales
2016 Most Influential SOE New Media Account
3 E-commerce
8
Product Service4
People oriented service
• Ranked as the world’s 13th top airlines by the SKYTRAX website, which was the highest ranking among the Chinese airlines
• First green passage for transportation of human donated organs • Launched a flight medical volunteer project • Over 2,419 volunteers providing medical assistance to 3,027 flights
Online intelligent an convenient services
In-flight entertainment service
• In-flight WIFI service• Self-service refund and endorsement• Pre-order excess baggage
• Designed and developed 45 new meals with local flavors• Increased number of Hollywood movies with an average
number of more than 130 movies per month • Themed flights for the International Children’s Day
• Seat selection • Online meal ordering • Online transit hotel booking
9
2016 Financial Highlights
Development Outlook
Business Overview & Operational Highlights
2016 vs 2015
Total Operating Revenue RMB 114,981m +3.0%
Attributable to Equity shareholders of the Company
RMB 5,044m +35.0%
Per share RMB 0.51 +35.0%
EBITDA RMB 22,745m +12.9%
ASK 255,992m +8.65%
ATK 34,980m +8.62%
Pax Load Factor 80.5% +0.0pts
Overall Load Factor 69.7% +0.2pts
Aircraft Utilization(Hr) 9.52 -0.10h
2016 Annual Results Highlights
11
144,980
3,084
58,042
206,106
138,769
3,527
47,292
189,588
0
25,000
50,000
75,000
100,000
125,000
150,000
175,000
200,000
225,000
Domestic Regional International Total
2016 2015
million
Operating Data
12
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
2014 2015 2016
Monthly RPK
Monthly Revenue Passenger Kilometers (RPK)
13
Revenue breakdown(Geographic)
Revenue breakdown (Product)
Domestic72.3%
Regional2.1%
International25.6%
Cargo & Mail6.6%
Passenger93.4%
2016 Traffic Revenue Breakdown
14
Traffic Revenue by Geographic Region
15
PAX revenue in RMB millionMarket Segment 2016 vs 2015Domestic 77,256 +0.9%Regional 2,230 -11.4%International 23,016 +8.8%Total 102,502 +2.3%
Cargo revenue in RMB millionMarket segment 2016 vs 2015Domestic 2,025 -0.9%Regional 86 -11.3%International 5,080 +7.6%Total 7,191 +4.8%Traffic total 109,693 +2.4%
Passenger Yield and Freight Yield
16
PAX Yield in RMB Market segment 2016 2015 Change
Domestic 0.53 0.55 -3.6%Regional 0.72 0.71 +1.4%International 0.40 0.45 -11.1%Average 0.50 0.53 -5.6%
Cargo Yield in RMB Market segment 2016 2015 ChangeDomestic 1.15 1.23 -6.5%Regional 3.91 4.49 -12.9%International 1.14 1.19 -4.2%Average 1.16 1.21 -4.1%
2016 2015 Change
RMB million RMB million
Jet Fuel 23,799 26,274 -9.4%
Staff 20,861 18,542 +12.5%
Airframe and Engine Maintenance 7,952 7,396 +7.5%
Depreciation and Amortization 12,619 11,845 +6.5%
Operating lease 7,330 6,153 +19.1%
Landing and Navigation 13,109 11,510 +13.9%
Catering 2,965 2,680 +10.7%
CAAC InfrastructureDevelopment Fund
2,565 2,482 +3.3%
2016 Annual Operating Costs
17
22.4%
7.5%11.9%
6.9%
2.8%
12.3%
16.6%
Jet FuelStaffAirframe and Engine MaintenanceDepreciation and AmortizationOperating leaseLanding and NavigationCateringOthers
19.6%
Unit Cost per ATK (RMB)
3.11
3.00
2015 2016
Cost Structure and Unit Cost
Operating Cost Structure
18
2,000
3,000
4,000
5,000
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
2015 2016
Jet Fuel Price (RMB/TON)
Monthly Jet Fuel Price (RMB/TON)
19
Debt Structure (RMB million Equivalent)
55.4%
1.7%0.3%
38.6%
USD JPY SGD RMB EUR
4.0%
24.3%
17.9%
57.8%
Short-term loan
Long-term loan
Finance lease payable
Term of the Debt
Debt Analysis
20
Aircraft type Avg. AgeOperating
LeasedFinanceLeased
Owned Total
Airbus A319 10.3 20 1 13 37
A320 7.5 40 39 54 133
A320-200NEO 0.1 2 0 0 2
A321 6.5 22 35 32 89
A330-200 7.6 2 11 3 16
A330-300 4.4 8 13 1 22
A380-800 4.7 0 2 3 5
Boeing B737-300 18.8 0 0 3 3
B737-700 10.4 4 7 34 45
B737-800 5.3 121 63 85 269
B747-400F 14.4 0 0 2 2
B757-200 15.5 10 10
B777-200A 20.5 0 0 4 4
B777-200F 4.3 0 5 7 12
B777-300ER 1.6 0 9 1 10
B787-8 2.6 2 14 0 16
B787-9 0.1 0 1 0 1
Embraer EMB190 4.5 20 4 2 26
Total 6.6 244 204 254 702
As of 31 Dec 2016
702aircrafts
1st
in Asia
21
Our Fleet
Year 2016 2017 2018 2019
Type Actual Delivery RetirementYear-end Forecast
Delivery RetirementYear-end Forecast
Delivery RetirementYear-end Forecast
Airbus A319 37 6 31 31 31
A319neo 0 0 0 2 2
A320 133 5 3 135 7 128 11 117
A320neo 2 5 7 3 10 6 16
A321 89 10 99 99 99
A321neo 0 8 8 12 20 14 34
A330-200 16 16 16 16
A330-300 22 7 29 5 34 34
A380 5 5 5 5
Boeing B737-300 3 3 0 0 0
B737-700 45 7 38 38 38
B737-800 269 41 3 307 30 10 327 1 326
B737-8max 0 7 7 18 25 28 53
B747-400F 2 2 2 2
B757-200 10 6 4 4 4
B777-200 4 2 2 2 0 0
B777-200F 12 12 12 12
B777-300ER 10 10 10 10
B787-8 16 16 16 16
B787-9 1 3 4 10 14 7 21
Embraer EMB190 26 26 26 26
22
Delivery and Retirement Plan (2017-2019)
2016 Financial Highlights
Development Outlook
Business Overview & Operational Highlights
Completeness and perfect quality of manual system
Application of safety big data
Internal emergency response mechanism
Continual safety training
1 Striving for the Highest Flight Safety Standards
24
In-flight WIFI service and the interconnection service between on-board and on the ground
FIRST CLASS BUSINESS CLASS ECONOMIC CLASS
2 Delivering Premium Flight and Online Experience
25
26
3 Enhancing hub construction
new Beijing airport
development
Guangzhou hub development for “Canton Route”
Synergy between Guangzhou and Shenzhen hubs
27
4 Constructing “China Southern E Travel”
By end of 2017:
Reach 20,000,000followers in social media
Increase 9,000,000downloads of App
2016 CHINA SOUTHERN CORPORATE SOCIAL RESPONSIBILITY REPORT
Speech on the Release
• This is our 10th CSR Report
2016 China Southern Corporate Responsibility Report
From 2007 to 2016
2016 China Southern Corporate Responsibility Report
• The first year for listed companies to report in accordance with the HKEx ESG Reporting Guide
Our 2016 CSR Report achieved FULL DISCLOSURE on General Disclosure items as stipulated in the ESG Reporting Guide
Characteristics of our CSR Implementation
Three Core Focuses
ENVIRONMENT
SOCIETY
GOVERNANCE
Environment
We see environmental protection as a major
responsibility
Optimization of fleet structure
Improvement of resource management
Introduction of state-of-the-art technologies
Environment
First to introduce
A320neoin Mainland China
Fleet size reached
700Average fleet age
6.6 years
Environment
Routes optimized on more than
120,000flights
Fuel saving of more than
20,000tons
Reduction in CO2 emission of more than
60,000tons
SocietyMore than
150 routes to Belt and Road countries and
regions
More than
900weekly flights
Largestcarrier along Belt
and Road
Guiyang - Seoul
Guangzhou – Phu Quoc
Silk Road Economic Belt
Belt and Road routes
Maritime Silk Road
International routes
Society
First to establish Green Channel
for the transportation of donated human organs
First to launch “On-board
Medical Volunteer Program”
56 return-to-origin and diversions
due to on-board medical emergencies
249 successful transportation of
donated human organs
Society• Proactive implementation of National
Strategy of “Targeted Poverty Alleviation”;
• Localized poverty alleviation projects in Xinjiang and Hubei;
• Total input to poverty alleviation funds:
7.5million RMB
• Various charitable activities and volunteering services;
• Yearly donation of more than
10million RMB
Governance
• Safety First
• Total safe flight hours
• 2.38 million
• Incident rate
• 0.008 per 10,000 flight-
hour
• Best safety performance in 5 years
• Continue to maintain China’s best safety record
Governance
• Best flight on-time performance in the past 5 years
• Ranked 13thin SKYTRAX World’s Most Loved Airlines, 1st
among all mainland Chinese carriers
Governance
• Stable Operations
• Passenger throughput
• 115 million
• 4.8% increase
• Total turnover
• 24.38 billion ton-
kilometre
• 8.9% increase
China Southern Airlines e-Travel
Guangzhou and Beijing dual-hub
Entering into Beijing new airport
Taking the building of “Sunshine Southern” as a starting
point, we are thoroughly pushing forward the development
strategies of Standardization, Integration, Intelligence, and
Internationalization to speed up our effort in transforming
China Southern Airlines to a world-class aviation industry
group with global competitiveness, and to create a brighter
future with all our stakeholders.
Q & A
43
DisclaimerWarning about Forward-looking StatementThis presentation contains certain forward-looking statements in relation to the financial conditions, operating results and business of theCompany. These statements represent the expectations or beliefs of the Company regarding future events, and are subject to risks anduncertainties, whether known or unknown. Such risks and factors might result in significant difference between actual results, performances orevents and the results, performances or events stated or implied in such statements. Certain statements, such as those including words andexpressions such as "potential", "estimate", "expect", "anticipate", "target", "intend", "plan”, "believe", "project" and similar phrases expressed indifferent forms, are regarded as "forward-looking statements". Forward-looking statements are subject to inherent risks and uncertainties. Itshould be noted that a number of factors might result in the actual outcome deviating from conditions expected or implied in the forward-lookingstatements, and in some cases such deviation might be significant. The contents of the forward-looking statements are updated as at the date onwhich such forward-looking statements are made, and should not be assumed to have been revised or updated to reflect latest information orsubsequent events. Market trends and factors that are expected to affect the operating results of the Company are set out in the sections headed"Business Review and Outlook" and "Financial Review."
Website www.csair.com
Email ir@csair.com
Tel (86) 20 8612 4462、(86)20 8611 2480
Fax (86) 20 8665 9040
Address 278 Ji Chang Road, Guangzhou, Guangdong Province PRC 510405
Investor Relations – Contact Information
Mobile App Download QR Code
南航AppChina Southern Airlines App
WechatDownload QR Code
44
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