Cathay Pacific Airways (0293)

[CityFarmer]

Cathay seems doing better than SIA...

(not vested in any airline stock)

Cathay Pacific’s annual profit triples despite dip in cargo revenue

HONG KONG — Cathay Pacific Airways said yesterday its annual profit tripled as higher travel demand helped the Hong Kong-based firm mask a decline in cargo revenue.

Unlike its key Asian rivals such as Singapore Airlines, Cathay’s strength in long-haul flights has helped it fend off rising pressure on yields in the medium- and short-haul market within Asia, where a proliferation of low-cost carriers is hitting fares for short-haul economy-class seats.

The airline’s more spacious seats in the economy category have been particularly popular on long flights to Europe and the United States, and command prices that are on average 80 per cent higher than those for regular economy-class seats, said UOB Kay Hian analyst K Ajith.

Net profit came in at HK$2.6 billion (S$425 million) last year, up from 2012’s restated earnings of HK$862 million, said the carrier. The result was in line with the average HK$2.74 billion forecast in a Wall Street Journal poll. Revenue rose 1.1 per cent to HK$100.5 billion.

Cathay had fitted 85 of its medium- and long-haul aircraft with premium economy-class seats as at the end of last year, raising the prospect this year of higher passenger yields or revenue per passenger mile.

“Business outlook for this year looks to improve compared with 2013,” said Chairman Christopher Pratt in a statement, though he warned that fuel prices would probably remain high.

Fuel costs, which accounted for 39 per cent of operating costs, fell 5.8 per cent to HK$38.13 billion last year on lower oil prices.

The airline said it carried nearly 30 million passengers last year, an increase of 3.3 per cent. Passenger yields on North American and European routes rose 8.3 per cent and 3.6 per cent respectively, compared with an overall increase of 1.8 per cent.

Cathay’s higher earnings on a rebound in travel demand may signal a positive start to the year for other Asian carriers, whose earnings have been hit by intensifying competition from Middle Eastern carriers and high fuel prices.
...
http://www.todayonline.com/business/cath...go-revenue

[kagemusha]

I believe this maybe a pre-cursor to SIA doing well this year, especially if the fuel price maintaining or falling further.

[cyclone]

Cathay Pacific to Revamp Fuel Hedges, Workforce; Shares Rise

Cathay Pacific Airways Ltd., Asia’s biggest international airline, plans to shorten its fuel-hedging program and revamp its workforce as part of a new business strategy to halt a slide in earnings. The shares jumped the most in nine months.

The carrier "won’t hedge as far forward as we have in the past" and will “rethink its workforce,” Chief Operating Officer Rupert Hogg told the South China Morning Post in comments confirmed by Cathay Pacific Monday. The Hong Kong-based airline plans to reassign employees from some outdated roles to new jobs that are better aligned with a "digital focus" while "never saying never" to redundancies, Hogg said.

Cathay Pacific is set to unveil a new strategy Wednesday following a “critical review” of its business as mounting competition from Chinese and Middle Eastern carriers caused the airline in October to scrap its second-half outlook. Chief Executive Officer Ivan Chu, who took the helm in March 2014, had said the carrier planned to continue with its fuel hedges.

More details in https://www.bloomberg.com/news/articles/...rce-revamp

[cyclone]

Cathay Stock Drops After Posting First Loss Since 2008

Cathay Pacific Airways Ltd. reported its first loss in eight years and scrapped plans for a second-half dividend after competition from Chinese airlines and losses from fuel hedging dented earnings. The stock fell the most in seven months.

The net loss totaled HK$575 million ($74 million) in 2016, Hong Kong-based Cathay said in a statement Wednesday. That compares with the median profit estimate of HK$450 million in a Bloomberg News survey of nine analysts. Sales at Asia’s largest international airline dropped 9.4 percent to HK$92.8 billion.

Cathay predicted the operating environment in 2017 would remain challenging, and also said premium travel from Hong Kong was below expectations, prompting the airline to sell such tickets at promotional prices to leisure travelers. The carrier, whose passenger yields have been damped by competition from full-service carriers for business seats and budget airlines for the mass market, said it is starting a three-year “corporate transformation” program to improve returns and operational efficiency.

More details in https://www.bloomberg.com/news/articles/...ese-rivals

[edragon]

Cathay Stock Drops After Posting First Loss Since 2008

Cathay Pacific Airways Ltd. reported its first loss in eight years and scrapped plans for a second-half dividend after competition from Chinese airlines and losses from fuel hedging dented earnings. The stock fell the most in seven months.

The Chinese increasingly switch to Chinese airlines increasing the bookings by about 15% YOY and decreasing by about 10% to foreign airlines YOY (9 months).

Just for info. another related news:-

Air China (00753) passengers carried up 2.8% in February

--

[BlueKelah]

Cathay Stock Drops After Posting First Loss Since 2008

Cathay Pacific Airways Ltd. reported its first loss in eight years and scrapped plans for a second-half dividend after competition from Chinese airlines and losses from fuel hedging dented earnings. The stock fell the most in seven months.

The net loss totaled HK$575 million ($74 million) in 2016, Hong Kong-based Cathay said in a statement Wednesday. That compares with the median profit estimate of HK$450 million in a Bloomberg News survey of nine analysts. Sales at Asia’s largest international airline dropped 9.4 percent to HK$92.8 billion.

Cathay predicted the operating environment in 2017 would remain challenging, and also said premium travel from Hong Kong was below expectations, prompting the airline to sell such tickets at promotional prices to leisure travelers. The carrier, whose passenger yields have been damped by competition from full-service carriers for business seats and budget airlines for the mass market, said it is starting a three-year “corporate transformation” program to improve returns and operational efficiency.

More details in https://www.bloomberg.com/news/articles/...ese-rivals

airline industry is definitely suffering from overcapacity now according to my friend who is SIA pilot. Chinese airlines adding many new planes to their fleets.

think there is excess capacity and competition from mid-east airlines as well. 

And hedging oil is like a double edge sword, too easy to get it wrong even when done by the pros.

Still think the old Buffett view of airlines is relevant, historically "airlines are a terrible business" to be in.

[cyclone]

Qatar Airways Buys Cathay Pacific Stake for $662 Million

By Kyunghee Park
November 6, 2017, 7:56 AM GMT+8 Updated on November 6, 2017, 11:58 AM GMT+8

Qatar Airways Ltd. agreed to acquire a stake in Cathay Pacific Airways Ltd., a deal that would help it gain a foothold in the world’s second-biggest aviation market.

The Middle Eastern carrier will buy 9.6 percent of Cathay from Hong Kong-based Kingboard Chemical Holdings Ltd. and related companies for HK$5.16 billion ($662 million), according to a filing to the city’s stock exchange Monday. Chief Executive Officer Akbar Al Baker, confirming the deal, said the investment "further supports Qatar Airways investment strategy.”

When completed, the purchase, the first ever investment by a Middle Eastern airline in an East Asian carrier, would make the Doha-based company the third-largest shareholder in Cathay. It would also provide access to mainland China, a country set to emerge as the world’s biggest aviation market within a decade. The deal comes a few months after Qatar Airways dropped a plan to invest in American Airlines Group Inc., which rebuffed the attempt.

More details in https://www.bloomberg.com/news/articles/...ay-pacific

[cyclone]

After 31 years, Cathay Pacific loses blue-chip status in Hong Kong
Carrier currently has smallest market cap among Hang Seng Index constituents

Laura He
PUBLISHED : Friday, 10 November, 2017, 7:05pm
UPDATED : Friday, 10 November, 2017, 11:15pm

Cathay Pacific, Hong Kong’s flagship carrier, will lose its status as a component of the city’s benchmark Hang Seng Index effective December 4, the Hang Seng Indexes Company said on Friday.

Cathay joined the index in June 1986, a month after its debut on the Hong Kong stock exchange.

At close on Friday, Cathay’s stock stood at HK$12.34 (US$1.6), down about 50 per cent from its peak of HK$24.1 in 2010. Its market cap of HK$48.5 billion is currently the smallest among the 50 constituents of the Hang Seng Index.

More details in http://www.scmp.com/business/companies/a...ock-market

[cyclone]

Cathay Nears End of Tunnel With Surprise Second-Half Profit

By Kyunghee Park
March 14, 2018, 12:17 PM GMT+8 Updated on March 14, 2018, 2:37 PM GMT+8

Cathay Pacific Airways Ltd. is finally seeing some respite from its earnings woes.

Asia’s biggest international carrier reported a surprise profit in the second half of 2017, with a pick-up in cargo and premium-travel demand helping narrow the full-year net loss to HK$1.26 billion ($161 million). That’s well below analysts’ expectations for a loss of HK$2.26 billion, based on estimates compiled by Bloomberg.

Ten months in the job, Chief Executive Officer Rupert Hogg can reassure investors that a rebound in business travel and cargo demand have contained the damage caused by past fuel-hedging contracts gone awry. Hogg also has cut 600 jobs as part of a three-year revamp, and taken delivery of newer aircraft to help Cathay become more competitive against low-cost and Chinese mainland carriers.

More detals in https://www.bloomberg.com/news/articles/...since-2008

[cyclone]

Cathay Pacific, which lost money in the last two years, aims to turn profitable in 2019

Andrew Wong
Published June 4, 2018

Cathay CEO says a younger fleet helps mitigate fuel price rises Cathay Pacific CEO on the benefits of a young long-haul fleet  
5 Hours Ago | 03:41
Rising fuel costs and the threat of a trade war will not affect Cathay Pacific's plan to turn in a profit in 2019, Chief Executive Rupert Hogg said on Monday as the airline seeks to recover from two straight years of losses.

The flag carrier of Hong Kong is currently in the midst of a three-year turnaround plan to keep costs low and improve revenue. That should help the airline to compete better and return to profitability next year, Hogg said.

"I'm not going to make any forecast about our future but that's our target and at the moment, we are on track to do that," he told CNBC's Matthew Taylor at the IATA Annual General Meeting in Sydney.

More details in https://www.cnbc.com/2018/06/04/cathay-p...e-war.html