Cathay suffers as profits slide

Cathay suffers as profits slide
By admin

Cathay Pacific has said it will “take whatever measures are necessary” to protect the business after plunging into the red in the first half of the year.

The carrier reported a loss of HK$935 (A$114m) in the six months to June 30, down 133% on the corresponding period last year.

High fuel costs, yield pressure and weak cargo demand were highlighted as key reasons for the decline.

Chairman Christopher Pratt said the recent softening of fuel prices provided “welcome relief” after a 6.5% rise in fuel costs during the period.

“Aviation will always be a volatile and challenging industry and our business will always be subject to factors, including economic fluctuations and fuel prices which are beyond our control,” he said. “The cost of fuel is our biggest challenge, although the recent reduction in the fuel price will, if sustained, provide welcome relief.

“We will continue to take whatever measures are necessary to protect the business, managing short term difficulties while remaining committed to our long term strategy.”

Measures taken to combat the market struggles include capacity reductions, the withdrawal of older, less fuel efficient aircraft and a recruitment freeze.

Cathay insisted however that it has kept its network intact and that brand and service quality would not be compromised.

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