Cathay ekes profit amid cargo pressure
Airline posts first-half net income of just HK$24 million in a turnaround from last year's losses that led to capacity cuts
Cathay Pacific Airways announced earnings well below expectations yesterday as yield pressure on regional routes and a weak cargo market derailed recovery efforts.
Cathay's ambitions to achieve a significant turnaround was also stymied by the losses generated from its air cargo joint venture, Air China Cargo, and establishment losses at its HK$5.9 billion cargo terminal at the airport that opened in February.
Still, thanks to lower jet fuel prices and stronger passenger demand, the company recovered from its HK$929 million loss in the same period last year. Turnover declined 0.6 per cent to HK$48.6 billion.
"The fortunes of the airline industry correlate closely with the world economy so we don't expect to see any sustained pickup in business until the world economy is on a surer footing," chairman Christopher Pratt said.
Airline operations in the past six months achieved HK$452 million in pre-tax profit, against HK$1 billion in losses last year.