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Property, plant and equipment, net (Tables)
 12 Months Ended
Dec. 31, 2019
Text block [abstract]  
Property, plant and equipment, net
 
 
  
 
 
 
 
 
 
Aircraft
 
 
 
 
 
 
 
 
 
 
 
  
Investment
properties
 
 
Buildings
 
 
Owned
 
 
Acquired
under
finance
leases
 
 
Other flight
equipment
including
rotables
 
 
Machinery,
equipment
and vehicles
 
 
Total
 
 
  
RMB
million
 
 
RMB
million
 
 
RMB
million
 
 
RMB
million
 
 
RMB
million
 
 
RMB
million
 
 
RMB
million
 
Cost:
  
   
 
   
 
   
 
   
 
   
 
   
 
   
At January 1, 2018
  
 
794
 
 
 
12,611
 
 
 
105,974
 
 
 
99,367
 
 
 
21,906
 
 
 
6,629
 
 
 
247,281
 
Acquisitions through business combinations
  
 
—  
 
 
 
51
 
 
 
—  
 
 
 
—  
 
 
 
12
 
 
 
34
 
 
 
97
 
Additions
  
 
—  
 
 
 
48
 
 
 
3,644
 
 
 
7,049
 
 
 
1,250
 
 
 
424
 
 
 
12,415
 
Transfer from construction in progress
  
 
—  
 
 
 
489
 
 
 
4,792
 
 
 
8,038
 
 
 
401
 
 
 
414
 
 
 
14,134
 
Reclassification on change of holding intention
  
 
19
 
 
 
(19
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
Reclassification on exercise of purchase option
  
 
—  
 
 
 
—  
 
 
 
3,940
 
 
 
(3,940
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
Transfer to assets held for sale
  
 
—  
 
 
 
—  
 
 
 
(1,804
) 
 
 
—  
 
 
 
(106
) 
 
 
—  
 
 
 
(1,910
) 
Disposals
  
 
—  
 
 
 
(26
) 
 
 
(7,784
) 
 
 
(154
) 
 
 
(774
) 
 
 
(252
) 
 
 
(8,990
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At December 31, 2018
  
 
813
 
 
 
13,154
 
 
 
108,762
 
 
 
110,360
 
 
 
22,689
 
 
 
7,249
 
 
 
263,027
 
Impact on initial application of IFRS 16 (Note 2(b))
  
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
(110,360
) 
 
 
(81
) 
 
 
—  
 
 
 
(110,441
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At January 1, 2019
  
 
813
 
 
 
13,154
 
 
 
108,762
 
 
 
—  
 
 
 
22,608
 
 
 
7,249
 
 
 
152,586
 
Acquisitions through business combinations
  
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
18
 
 
 
18
 
Additions
  
 
—  
 
 
 
181
 
 
 
3,034
 
 
 
—  
 
 
 
2,380
 
 
 
860
 
 
 
6,455
 
Transferred from construction in progress (Note 20)
  
 
—  
 
 
 
2,515
 
 
 
871
 
 
 
—  
 
 
 
200
 
 
 
456
 
 
 
4,042
 
Reclassification on change of holding intention:
  
   
 
   
 
   
 
   
 
   
 
   
 
   
- transferred to other property, plant and equipment, net
  
 
(327
) 
 
 
327
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
- transferred to
right-of-use
assets, net (Note 21)
  
 
(16
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
(16
) 
Transferred from
right-of-use
assets on exercise of purchase option (Note 21)
  
 
—  
 
 
 
—  
 
 
 
2,641
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
2,641
 
Disposals
  
 
—  
 
 
 
(131
) 
 
 
(2,032
) 
 
 
—  
 
 
 
(803
) 
 
 
(330
) 
 
 
(3,296
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At December 31, 2019
  
 
470
 
 
 
16,046
 
 
 
113,276
 
 
 
—  
 
 
 
24,385
 
 
 
8,253
 
 
 
162,430
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated depreciation and impairment losses:
  
   
 
   
 
   
 
   
 
   
 
   
 
   
At January 1, 2018
  
 
270
 
 
 
3,965
 
 
 
50,995
 
 
 
17,011
 
 
 
11,678
 
 
 
4,436
 
 
 
88,355
 
Depreciation charge for the year
  
 
29
 
 
 
413
 
 
 
5,667
 
 
 
5,776
 
 
 
1,462
 
 
 
622
 
 
 
13,969
 
Reclassification on change of holding intention
  
 
15
 
 
 
(15
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
Reclassification on exercise of purchase options
  
 
—  
 
 
 
—  
 
 
 
1,072
 
 
 
(1,072
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
Transferred to assets held for sale
  
 
—  
 
 
 
—  
 
 
 
(1,582
) 
 
 
—  
 
 
 
(104
) 
 
 
—  
 
 
 
(1,686
) 
Disposal
  
 
—  
 
 
 
(10
) 
 
 
(6,912
) 
 
 
(154
) 
 
 
(664
) 
 
 
(240
) 
 
 
(7,980
) 
Impairment losses written off on disposals
  
 
—  
 
 
 
—  
 
 
 
(322
) 
 
 
—  
 
 
 
(1
) 
 
 
—  
 
 
 
(323
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At December 31, 2018
  
 
314
 
 
 
4,353
 
 
 
48,918
 
 
 
21,561
 
 
 
12,371
 
 
 
4,818
 
 
 
92,335
 
Impact on initial application of IFRS 16 (Note 2(b))
  
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
(21,561
) 
 
 
—  
 
 
 
—  
 
 
 
(21,561
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At January 1, 2019
  
 
314
 
 
 
4,353
 
 
 
48,918
 
 
 
—  
 
 
 
12,371
 
 
 
4,818
 
 
 
70,774
 
Depreciation charge for the year
  
 
29
 
 
 
444
 
 
 
6,390
 
 
 
—  
 
 
 
1,483
 
 
 
683
 
 
 
9,029
 
Reclassification on change of holding intention:
  
   
 
   
 
   
 
   
 
   
 
   
 
   
- transferred to other property, plant and equipment, net
  
 
(172
) 
 
 
172
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
- transferred to
right-of-use
assets, net (Note 21)
  
 
(5
) 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
(5
) 
Transferred from
right-of-use
assets on exercise of purchase option (Note 21)
  
 
—  
 
 
 
—  
 
 
 
874
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
874
 
Disposals
  
 
—  
 
 
 
(52
) 
 
 
(1,993
) 
 
 
—  
 
 
 
(698
) 
 
 
(238
) 
 
 
(2,981
) 
Provision for impairment losses (Note 19(d))
  
 
—  
 
 
 
—  
 
 
 
18
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
18
 
Impairment losses written off on disposals (Note 19(c))
  
 
—  
 
 
 
—  
 
 
 
(30
) 
 
 
—  
 
 
 
(37
) 
 
 
—  
 
 
 
(67
) 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At December 31, 2019
  
 
166
 
 
 
4,917
 
 
 
54,177
 
 
 
—  
 
 
 
13,119
 
 
 
5,263
 
 
 
77,642
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net book value:
  
   
 
   
 
   
 
   
 
   
 
   
 
   
At December 31, 2019
  
 
304
 
 
 
11,129
 
 
 
59,099
 
 
 
—  
 
 
 
11,266
 
 
 
2,990
 
 
 
84,788
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At December 31, 2018
  
 
499
 
 
 
8,801
 
 
 
59,844
 
 
 
88,799
 
 
 
10,318
 
 
 
2,431
 
 
 
170,692
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
As at December 31, 2019, the accumulated impairment provision of aircraft and flight equipment of the Group is RMB985 million (December 31, 2018: RMB1,034 million).
 
(b)
As at December 31, 2019, certain aircraft of the Group with an aggregate carrying value of approximately RMB339 million (December 31, 2018: RMB373 million) were mortgaged under certain loans (Note 36(a)(i)).
 
(c)
For the year ended December 31, 2019, certain aircraft and other flight equipment were disposed, against which impairment provision had been provided in previous years and the impairment provision of RMB30 million for these aircraft and RMB37 million for the other flight equipment was written off respectively.
 
(d)
As at December 31, 2019, the Group reviewed the recoverable amounts of the aircraft and related assets and made an additional impairment provision of RMB18 million for its aircraft. The estimates of recoverable amounts were based on the greater of the assets’ fair value less costs of disposal and the value in use. The fair value on which the recoverable amount is based is categorized as a level 3 measurement and it was determined by reference to the recent observable market prices for the aircraft fleet and flight equipment. In cases when value in use are based, the pre-tax discount rate used in the estimate is 9.00%.
 
(e)
As at December 31, 2019 and up to the date of approval of these financial statements, the Group is in the process of applying for the property title certificates in respect of the properties located in Guangdong, Guangxi, Guizhou, Xiamen, Heilongjiang, Jilin, Beijing, Henan, Xinjiang, Hainan, Shanghai, Hubei, Chongqing, Liaoning and Chengdu, in which the Group has interests and for which such certificates have not been granted. As at December 31, 2019, carrying value of such properties of the Group amounted to RMB7,106 million (December 31, 2018: RMB5,289 million). The Directors of the Company are of the opinion that the use of and the conduct of operating activities at the properties referred to above are not affected by the fact that the Group has not yet obtained the relevant property title certificates.
 
(f)
The Group leased out investment properties and facilities under operating leases. The leases typically run for an initial period of one to ten years, with an option to renew the leases after that date at which time all terms are renegotiated. None of the leases includes contingent rentals. In this connection, rental income totalling RMB202 million (2018: RMB178 million; 2017: RMB184 million) was recognized by the Group during the year in respect of the leases. Directors estimated the fair value of these investment properties approximate the carrying amount.
Future Minimum Lease Income under Non-cancellable Operating Leases
The Group’s total future minimum lease income under
non-cancellable
operating leases are as follows:
 
 
  
2019
 
  
2018
 
 
  
RMB million
 
  
RMB million
 
Within 1 year
  
 
38
 
  
 
55
 
After 1 year but within 5 years
  
 
74
 
  
 
39
 
After 5 years
  
 
36
 
  
 
7
 
 
  
 
 
 
  
 
 
 
 
  
 
148
 
  
 
101