Cathay Pacific CEO blames coronavirus for historic HK$9.9 billion loss, and calls third wave a ‘cause for concern’

Name: Hong Kong government to bail out Cathay Pacific with HK$30 billion in loans and direct stake
Uploaded: 2020-07-17T04:38:23.000Z
Duration: 1 min 29 s
Description: Hong Kong government to bail out Cathay Pacific with HK$30 billion in loans and direct stake

Airline boss Augustus Tang says result ‘underlines the extent of the damage’ done to carrier by Covid-19

Internal memo gives clue to carrier’s future with restructuring review to ‘balance stakeholder interests’

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Cathay Pacific says it expects to record a loss of nearly HK$10 billion for the first half of the year. Photo: Winson Wong

Danny Lee

Published: 12:38pm, 17 Jul 2020Updated: 7:21pm, 3 Aug 2020

Cathay Pacific Airways has said it expects to make a loss of HK$9.9 billion (US$1.28 billion) in the first six months of 2020, the largest in its history.

Augustus Tang Kin-wing, the airline’s CEO, blamed the profit warning on the coronavirus pandemic, and staff were told in a memo that its restructuring review, which could impact jobs, would “balance stakeholder interests”, giving an extra clue to the factors likely to determine the company’s future size and shape.

The Hong Kong government appointed two observers to the Cathay Pacific board this week to oversee its HK$27.3 billion rescue package of the city’s flag carrier, which won shareholder approval on Monday.

“The result underlines the extent of the damage being inflicted on our operations since Covid-19 started spreading across our markets, decimating the demand for air travel as customers were unable or unwilling to fly,” Tang said, adding the third wave of cases in the city was a “cause for concern”.

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Hong Kong government to bail out Cathay Pacific with HK$30 billion in loans and direct stake

Cathay swung to the biggest loss in the company’s reporting of a six-month or full-year period from a HK$1.3 billion net profit in the same time last year. Its previous biggest loss was in 2008 at the height of the global financial crisis, when it lost HK$8.6 billion.

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