On November 14th, Caixin reporters (Reporter Lu Tingting) reported, "Currently, we are in contact with multiple luxury brands and are expected to make progress soon." At the earnings conference for the third quarter held at Baiyun International Airport (600004.SH) today, the company's director replied to investors' questions about the new developments in introducing luxury brands. In addition, duty-free operations and the recovery of international business became the focus topics of the conference.

Previously, the Ministry of Finance, the Ministry of Commerce, the Ministry of Culture and Tourism, the General Administration of Customs, and the State Taxation Administration issued the "Notice on Improving the Policy of In-city Duty-Free Shops," specifying the establishment of 1 in-city duty-free shop in 8 cities including Guangzhou.

Regarding its impact, Baiyun International Airport's chairman Wang Xiaoyong frankly admitted that the establishment of in-city duty-free shops is beneficial to the company's operations. "On the one hand, it is conducive to expanding the duty-free market together. By strengthening cooperation with in-city duty-free shops, Baiyun International Airport's duty-free business can reach potential customers more widely, further enhancing market influence. On the other hand, it also contributes to increasing the commercial revenue of Baiyun International Airport."

Caixin reporters learned from the earnings conference that with the recovery of international passenger traffic, Baiyun International Airport's duty-free sales have also shown some growth, and the amount of consumption per passenger is trending upwards.

"Since the beginning of this year, we have been continuously promoting the development of international routes, providing passengers with more travel options through new routes such as Guangzhou to Belgrade, Budapest, Jeju, and Fukuoka," company executives said.

However, the international business of Baiyun International Airport has not completely recovered to pre-pandemic levels.

Wang Xiaoyong stated that due to the impact of the international political and economic environment, China's international aviation market has not recovered as expected, especially the routes to the United States, Canada, and India, where flight rights have not fully resumed, coupled with insufficient airline capacity and unmet outbound passenger demand. Some international markets are constrained in their recovery and development. By the end of the year, the aim is to recover the international market to over 80% of the 2019 level, with an even higher recovery level estimated for next year.

In the first three quarters of this year, guangzhou baiyun international airport achieved double growth in revenue and net income. Looking at each quarter, Q1, Q2, and Q3 achieved net profits of 0.188 billion yuan, 0.25 billion yuan, and 0.23 billion yuan respectively; financial expenses were 18.345 million yuan, 10.4958 million yuan, and 23.0125 million yuan respectively.

Regarding the third quarter net income being lower than the second quarter, guangzhou baiyun international airport explained that some maintenance projects were completed in the third quarter, resulting in the related cost expenses being recognized in the third quarter, leading to higher costs in the third quarter compared to the second quarter. Typically, cost expenses in the second half of the year are higher than in the first half.

The increase in financial expenses in the third quarter is partly due to the impact of leasing standards, and on the other hand, it is due to the reduction in bank deposit interest rates and different deposit structures, leading to a decrease in interest income.