The Cathay Pacific group more than doubled its 2013 operating profit to HK$3.76 billion ($484 million), as its passenger business outperformed the weaker cargo operations.
The impressive operating profit compares to a figure of HK$1.61 billion in 2012. The Oneworld carrier also reported a 203% increase in net profit to HK$2.62 billion for the year.
The improved result was driven by a 1.1% increase in group revenue to HK$100 billion, while operating expenses decreased by a similar amount to HK$96.7 billion.
The increase in revenue came despite capacity decreasing by 1.8%, which the carrier said was due to the winding down of flights by its Boeing 747-400 fleet. A 1.8% improvement in yield also helped to push up passenger revenue by 2.4% to HK$71.8 billion. Load factor also improved 2.1 percentage points to 82.2% for the year.
Despite strong improvements in the passenger business, Cathay’s chairman Christopher Pratt said in his letter to shareholders that the air cargo business remained weak.
“There was some recovery in business during the last three months... of 2013, though business was still weaker than in the corresponding period of 2012,” he said.
Cargo revenue declined by 3.6% to HK$23.7 billion as yield fell by 4.1% and capacity increased 1.7%. Cargo load factor decreased by 2.4 percentage points to 61.8%.
Cathay says it took delivery of 19 aircraft over the year as it retired five 747-400s. The incoming fleet comprised of five Airbus A330-300s (including one operated by Dragonair), nine 777-300ERs and five 747-8 Freighters.
This year the airline is scheduled to take delivery of 16 new aircraft, with the first one delivered in January.
In his outlook, Pratt says he expects the airline to improve on last year’s results in 2014 as the passenger business continues to perform well and will see further benefits from adding more frequencies on long-haul routes.
“We will continue to invest to make our business stronger while keeping our financial position strong,” he adds.