By Sophie Yu and Brenda Goh

BEIJING Air China's Hong Kong-listed shares rose almost 6% on Friday, their biggest jump in four months, after the flagship carrier reported its first quarterly profit in nearly four years.

Air China booked third-quarter net profit of 4.24 billion yuan ($579.48 million) after market close on Thursday, versus a loss of 600 million yuan in the previous quarter and 8.67 billion yuan in the same period last year.

The profit, which brokerage Jefferies said followed 15 quarters of loss, also turned earnings positive for the nine months of this year with a profit of nearly 800 million yuan.

Increased passenger capacity, a stable currency and investment income contributed to the profit, Jefferies said in a client report on Friday.

Hopes are high in the industry that Air China, China Eastern Airlines and China Southern Airlines - the big three state carriers - can finally return to profit in the second half of 2023 after years of pandemic-induced loss.

On Friday, the aviation regulator said air passenger numbers in the third quarter reached 180 million, 2.6% higher than the pre-pandemic level in 2019, and a record for any quarter ever.

Li Hanming, an independent expert on Chinese aviation, said the number of international flights, especially to developed countries, is still markedly smaller than in 2019.

"Those routes are the most lucrative," Li said.

Air China did not provide a breakdown of how domestic and international travel made up its revenue. Domestic travel rebounded quickly to pre-2019 levels after the government abandoned its zero-COVID-19 policy at the end of last year but international flights have only been increasing gradually.

The number of international flights to and from China is still only 50% to 60% of the pre-pandemic era, showed data from tracking app Flight Master.

Resumption of international flights also varies between destinations. As at early October, the number of flights to Britain or Italy was about 110% versus 2019, whereas to the U.S. the number was 5% to 10%, industry experts said.

Airlines will further resume and add international routes in the fourth quarter as they shift to new Winter-Spring schedules on Oct. 29. China Eastern, for instance, will restart Shanghai-to-Brisbane flights on Oct. 31, and Air China will resume flights between Beijing and San Francisco on Nov. 1.

China Eastern said it expects international and regional flights to recover in the new aviation season to 80% of 2019 levels by the end of the year.

Shanghai-based China Eastern is set to report earnings on Monday, whereas China Southern will report later on Friday.

Air China's stock price was last up 3.75% at HK$5.26 ($0.67) at the midday trading break.

($1 = 7.3169 Chinese yuan renminbi)

($1 = 7.8188 Hong Kong dollars)

(Reporting by Sophie Yu and Brenda Goh; Editing by Christopher Cushing)