Korean Air is expected to continue its trajectory with another solid quarter, backed by increased revenue from the company’s cargo business, according to a security firm’s report and industry sources Friday.

According to Daishin Securities’ report, Korean Air’s revenue from its cargo business is expected to increase in the second quarter due to high demand, increased cargo and a recent drop in fuel prices.

“The April-June period is considered as a low season for air carriers, but Korean Air is expected to post earnings that are better than consensus,” a source from the local aviation industry said.

Daishin Securities analyst Yang Ji-hwan said Korean Air’s operating profit in the second quarter is estimated at around 500 billion won ($363 million), beating market consensus among local securities analysts who forecast 463 billion won, according to financial information provider FnGuide.

In the first quarter, Korean Air's revenue and operating profit rose 20 percent and 5 percent from a year earlier, respectively.

The air carrier has benefited largely from the increases in air cargo rates in the April-June period. According to Yang, the air cargo rate for Korean Air in the quarter is estimated at 479 won per 1 kilogram, 40 won higher than the first quarter. The 40-won increase in the air cargo rate will boost Korean Air’s revenue by 86 billion won, Yang added.

The decrease in oil prices during the three-month period is expected to benefit the company’s quarterly earnings.

The airline is also expected to report improved cargo earnings based on the recent spike in Korea’s shipping orders from Chinese e-commerce platforms.

Industry sources also noted Korean Air has partly benefited from the global logistics and shipping disruptions caused by the Suez Canal crisis.

In the second quarter, air traffic passenger demand was also higher than expected as the overall air travel demand continued to edge closer to matching pre-pandemic levels, Yang said.

According to the analyst, Korean Air’s earnings may improve further in the third and fourth quarters this year as overall passenger traffic and cargo demand generally go up in the second half.