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Cathay Pacific Airways nears break even despite depressed October passenger numbers
November 18th 2021
Cathay Pacific Airways expects its second-half results to be substantially improved over its first half after a strong cargo season moved the carrier closer to breaking even in the four months to October 31. Read More » However, the Hong Kong-based airline is still bracing for substantial full-year losses as passenger numbers remain woefully depressed compared with pre-pandemic levels. While cargo numbers were still down on 2019, revenue tonne kilometres (RFTKs) rose 21% year-on-year and the cargo load factor increased by 4 percentage points to 82.9%. The airline underpinned air freight growth with cargo-only passenger flights to operate at 70 % of pre-pandemic capacity. Cargo continued to be strong in Hong Kong, Southeast Asia performed well and return traffic from the Americas and Europe has gathered momentum, the airline said in its monthly traffic report. “The second half of the year is typically our peak cargo period,’’ Cathay Pacific chief customer and commercial officer, Ronald Lam, said. “The exceptionally strong cargo season that we are experiencing so far, together with our continued focus on effective cash and cost management, have led to a positive impact on our operating cash burn. This is to the extent that we have been able to achieve close to operating cash break even for the four-month period from July to October 2021.” The news was not so rosy for passenger numbers. Cathay carried 76,430 passengers last month. It was an increase of 98.3% compared with October 2020, but a 97.2% decline compared with same month in 2019. Passenger load factor increased by 11.4 percentage points to 29.6%. Capacity, measured in available seat kilometres, rose 19.9%, remained 89.9% down on two years ago. “October was more challenging for our passenger business than recent months,” Lam said. “Demand for student travel, which had been robust in the past few months, tapered down quickly from early October. As such, we trimmed our passenger capacity by about 19% compared with September. Overall, we only managed to operate approximately 10% of our pre-pandemic passenger capacity against October 2019. Our average daily passenger numbers dropped about 44% versus the previous month, to 2,465.” Despite weaker figures for long-haul routes, Lam said short-haul operations remained robust with demand for flights serving Asia “encouraging”. Cathay expected its second-half 2021 results would be “a considerable improvement on our first half 2021 results, although our overall losses for full-year 2021 will still be substantial”, he said. “Nevertheless, our operating environment continues to be one of considerable uncertainty. Travel and operational restrictions continue to greatly impact our ability to mount flights and we are still facing many challenges to our passenger and our cargo business as the COVID-19 situation in different parts of the world continues to evolve,” Lam said.
