Cathay H1 profit jumps seven-fold to HK$6.8b

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Cathay Pacific Airways has posted a seven-fold surge in net profit to HK$6.8 billion ($875.9 million) for the first half of the year.

This is HK$6 billion higher than the HK$812 million net profit it reported in the corresponding period a year ago.

Turnover for the six months ended 30 June jumped 34% to HK$41.3 billion, says the Oneworld carrier. Operating expenses rose 26% to HK$36.4 billion.

Cathay's operating profit surged 249% to HK$7.1 billion, it adds.

Business recovery that began in the last quarter of 2009 gained momentum in 2010, resulting in the improved financial results, says Cathay's chairman Christopher Pratt.

"Our passenger business experienced a marked improvement from the lows of 2009 with revenues returning almost to pre-financial crisis levels," he adds.

In particular, traffic to and from mainland China and the Pearl River Delta continued to grow during the period, says the carrier.

Passenger numbers for the first half of 2010 rose 9% to 13 million, and the passenger load factor rose 5.5 percentage points to 84%, says Cathay.

The airline's cargo business was "very robust" for the first half of 2010 with strong demand in all markets, says Pratt. Total cargo volumes rose 24% to 872,000t during the period.

Cathay added four Boeing 777-300ERs to its fleet during the first half of the year, and brought back into service five 747-400 converted freighters that were parked in the desert in 2009.

In 2011, the airline plans to return four Airbus A340-300s under the terms of their operating leases. The aircraft are now parked in the desert, along with two 747-400s.

Cathay will also begin taking delivery of 10 747-8 freighters in January 2011.

Looking ahead, the airline expects its financial results to be strong in the second half of the year, says Pratt.

"That said, conditions can change rapidly in the airline industry. Our results would be adversely affected, and very quickly so, by a significant further increase in fuel prices or any return to the recessionary economic conditions of 2008 and much of 2009," he adds.