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Spring Airlines, a Chinese budget airline based in Shanghai, said on Friday its sales revenues for last year reached 540 million yuan.

Spokesman Zhang Lei said the company operated 6,713 flights last year transporting 1.13 million passengers, and made a profit of more than 20 million yuan.

Zhang attributed the success to the market response to the company's budget travel strategy, slashing fares by an average of 61.8 percent, since its launch in July 2005.

Last year, 94.4 percent of seats were booked, the highest rate among China's domestic airlines.

Spring Airlines has signed an agreement with the Hainan provincial government to start new flights from all its branches in other cities to Hainan this year, aiming to bring more tourists to the island province.

Some of the new flights will begin before the Spring Festival, according to Zhang.

Spring Airlines launched its maiden flight in July 2005, becoming the first airline to announce a budget travel strategy in China.

However, its budget travel strategy also run into regulatory problems. The company was fined 150,000 yuan by Jinan Price Bureau in east China's Shandong Province for selling more than 400 one-yuan tickets for flights between Jinan and Shanghai late last year.

(Xinhua News Agency January 27, 2007)