On Oct. 24, Asiana Airlines, the second-largest South Korean carrier, reported a third profit decline in four quarters as it posted a smaller gain from currency fluctuations.

Net income in the third quarter fell 15 percent to 36.9 billion won, or US$40 million, from 43.6 billion won a year earlier, the airline said in a regulatory filing. Sales and operating profit rose after the airline flew more passengers.

The won appreciated at a slower pace in the third quarter than a year earlier, causing a lesser drop in the repatriated value of the overseas debt of Asiana. Profitability could be hurt this quarter as fuel costs, the biggest expense for Asian carriers, may swell after oil prices rose to a record recently.

"The airlines will probably see costs increasing and they will have to find a way to pass on some of the costs, like through more fuel surcharges," said Baik Ji Ae, an analyst at Tong Yang Investment Bank in Seoul.

Asiana fell 0.7 percent to 9,450 won at the close of trading in Seoul, after earlier declining as much as 4.3 percent. The stock has advanced 38 percent this year, beating a 35 percent gain for the benchmark Kospi index.

The airline had a currency translation gain of 2.25 billion won in the third quarter, 91 percent less than its 23.7 billion won gain a year earlier, it said.

The South Korean currency gained 0.7 percent in the three months ended Sep. 30 compared with 1.6 percent a year earlier, according to Seoul Money Brokerage Services.

The South Korean government is considering raising the ceiling on jet fuel surcharges, which would enable Asiana and bigger rival Korean Air Lines to increase levies, Chung Il Young, a civil aviation policy director at South Korea's Construction & Transportation Ministry, said on Oct. 23. The timing and extent of the raise has not been decided.

Jet fuel prices have gained 35 percent this year, rising to a record US$99.85 per barrel in Singapore last week. A US$1 increase in the average jet fuel price adds 29.4 billion won in annual costs for Korean Air and 12 billion won for Asiana, said Song Jae Hak of Woori Investment & Securities.

Asiana's operating profit, or sales minus the cost of goods sold and administrative expenses, climbed 75 percent in the third quarter to 80.1 billion won, the statement said. Sales grew 4.8 percent to 967 billion won. The airline paid an average of 2 percent less for fuel per gallon in the third quarter compared with a year earlier, according to the filing.