April 26, 2024

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[THE INVESTOR] Asiana Airlines’ fourth-quarter earnings last year were dented by underperforming subsidiaries and exchange rate loss, said KB Investment and Securities on Feb. 6, lowering the target price to 5,100 won (US4.48) from 5,400 won. 

The airline company missed the market expectations despite decent income from air freight division and favorable oil price, as profits from subsidiaries were lower than expected with the launch of low-cost carrier Air Seoul, said analyst Kang Seong-jin.

“Foreign currency-related loss in particular was more than double that of estimates, reaching 148.5 billion won as its overseas borrowings increased from leasing two A380 aircraft in the fourth quarter last year,” explained the analyst. 

Although Asiana Airlines’ decision not to participate in Kumho Group’s acquisition of Kumho Tire is positive, it has already been reflected, and its operating profit this year will reach 219.9 billion won, down 14.4 percent on-year, estimated Kang.

By Hwang You-mee (glamazon@heraldcorp.com)