Cathay reports HK$8.6bn loss
11-03-2009
Cathay Pacific has reported a net loss of almost HK$8.6-billion for last year, on the back of falling cargo demand and volatile fuel prices. It was the airline's first annual loss for ten years. Cathay said that high oil prices in the first half of the year had hit its bottom line. It added that the tumbling oil price in the second half of 2008 had also led to losses of HK$7.6 billion from hedging contracts taken out to protect it against the high cost of fuel. "Having made a painful adjustment to high fuel prices, the aviation industry now has to adjust to a severe economic downturn," said the carrier's chairman Christopher Pratt. "Cathay Pacific expects an extremely challenging year in 2009." Turnover at the airline rose 14.9 percent year-on-year to HK$86.6-billion. The net loss compared to a profit in 2007 of HK$7-billion. Passenger numbers on Cathay and its sister airline Dragonair increased to 25-million in 2008, up 7.3 percent, mainly due to strong demand in the first half of the year. The volume of cargo carried dropped 1.6 percent to 1.6 million tonnes, as demand from goods made in Hong Kong and southern China dried up in the last quarter as a result of the global slowdown. Cathay says it will look at cost cutting measures. The airline's chief executive, Tony Tyler, said the company is reviewing some of its routes. Asked if job cuts were possible, Mr Tyler said they would consult staff if any decisions had to be made.
