News
Cathay Pacific Airways begins “critical review of our business” and issues a profit warning
October 14th 2016
Hong Kong’s Cathay Pacific Airways issued a profit warning mid-week and said “the operating environment in the second half of the year was expected to continue to be affected by the same adverse factors as in the first half and that the overall business outlook remained challenging”. Read More » Overcapacity and intense competition means the airline no longer expected the group’s results for the second half [of 2016] to be better than those of the first half. Cathay has posted an interim profit of HK$353 million (US$46 million), an 82% year-on-year profit decline.
The full service carrier is suffering from below target premium bookings and declining overall yields, especially on its bread-and-butter trunk routes from Hong Kong to London and New York.
“Against this difficult revenue picture, we are engaged in a critical review of our business, the goal of which is to improve revenues and to reduce costs so as to maintain a strong financial position and to deliver acceptable financial returns,” Cathay said. Cathay’s stock declined to a seven-year low after the profit warning was released.
