News
Cathay Pacific Group forecasts US$1.3 billion first half loss
July 17th 2020
Cathay Pacific Group said today it expected to report a net loss of HK$9.9 billion (US$1.3 billion) for the first half of calendar 2020 as a result of an uncertain aviation landscape that was showing no indications of meaningful recovery from COVID-19. Read More »
The forecast loss for the six months to June 30, based on unaudited accounts, represented a HK$11.2 billion turnaround from a net profit of HK$1.3 billion a year ago, the Group said in a regulatory filing to the Stock Exchange of Hong Kong.
The net loss included impairment charges of about HK$2.4 billion, related mainly to 16 aircraft that were "unlikely to re-enter meaningful economic service again before the 2021 summer season", and certain airline service subsidiaries assets.
The monthly traffic report showed the combined Cathay Pacific Airways/Cathay Dragon network carried 27,106 passengers in June, or about 900 passengers a day. The passenger carriage represented a 47% improvement from 18,473 passengers in May, but was down 99.1% compared with the same month in 2019.
Passenger load factor for June was 27.3%, a decline of 59.3 percentage points from 12 months ago and slightly below the 29.6% posted in May.
Cathay Pacific Group chief customer and commercial officer, Ronald Lam, said demand continued to be very weak in June.
“The landscape of international aviation remains incredibly uncertain with border restrictions and quarantine measures still in place across the globe," Lam said in a statement.
"Although we have begun to see some initial developments, notably a slight increase in the number of transit passengers following the easing of transit restrictions through Hong Kong International Airport, we are still to see any significant signs of immediate improvement."
Lam said transit traffic had risen through June and represented about 32% of overall traffic at the end of the month, with "notable demand from destinations in Southeast Asia such as the Philippines and Vietnam to North America".
"This change in traffic mix meant a more tapered average yield performance though,” Lam said.
Lam said capacity across Cathay Pacific and Cathay Dragon was expected to be about 10% of normal flight schedules in August, compared with about 7% in July.
"While some markets are starting to relax border restrictions and quarantine requirements in July, we remain cautious and agile in our approach to resuming our passenger flight services," Lam said.
At an Extraordinary General Meeting held on July 13 in Hong Kong, the group’s shareholders overwhelmingly approved the HK$39 billion recapitalisation plan announced in June.
