Airlines
Cathay Pacific Airways to raise $2 billion and to buy five used 777s
August 26th 2016
Hong Kong’s Cathay Pacific Airways has applied to raise $2 billion in medium-term debt, the carrier said in a note to the Hong Kong Stock Exchange on Tuesday. Read More » The funds are expected to pay for new aircraft purchases, including 43 additional A350 jets.
Meanwhile, Orient Aviation understands the carrier has reached a deal with Dubai’s Emirates Airline to buy five of their used B777-300s, which the Middle Eastern carrier had planned to retire. The frames were originally manufactured in 2001-2 and will replace the five -200s in Cathay’s fleet.
Cathay will retire its remaining three B747-400s by October, with the last revenue flight scheduled for October 1 from Tokyo’s Haneda to Hong Kong. The oneworld member will retire all of its A340-300s by the end of 2017. Last week, the Hong Kong-based airline reported an attributable profit of HK$353 million ($45.5 million) for the first six months of 2016, down 82% year-on-year, on a 10.1% yield decline and a load factor of 84.5% (-1.4%).
“The operating environment in the first half was affected by economic fragility and intense competition. There was sustained pressure on revenues, reflecting suspension of fuel surcharges, weak currencies in some markets, weak premium class demand, particularly on long-haul routes [despite a 4.7% increase in long-haul capacity], and a higher proportion of passengers transiting through Hong Kong,” said John Slosar, chairman of Cathay Pacific Airways, who added the outlook for the rest of the year “remains challenging”, but emphasized that no service related costs would be cut. “In fact, we are investing in new products and better service,” he said.
