Cathay Pacific overhaul paying off, John Slosar says

Business | 13 Mar 2019 12:39 pm

Cathay Pacific Group reported today net profit of HK$2.34 billion for 2018, representing an increase of 3.6 percent, while Cathay Pacific and Dragon also returned to profit.

The group had booked a net loss for two consecutive years – HK$1.26 billion in 2017 and HK$575 million in 2016.

Profit per share was 59.6 HK cents last year compared to a loss per share of 32 HK cents in the year before.

Group revenue climbed by 14.2 percent year-on-year to HK$111.06 billion.

Cathay Pacific and Cathay Dragon turned a profit of HK$695 million compared with a HK$4.18 billion loss for 2017. In the first half of 2018, the airline's loss was HK$844 million.

Cathay Pacific and Cathay Dragon staff costs increased by 1.6 percent, to HK$17.98 billion, from HK$17.70 billion in 2017.

John Slosar, Cathay Pacific's chairman, said the airline's transformation program remains on track and had a positive impact. "We focused on finding new sources of revenue, building our network and strengthening the Hong Kong hub, delivering more value to our customers and improving productivity and efficiency," he said.

A final dividend of 30 HK cents was declared.

Slosar said the group restructured operations outside Hong Kong, benefited from productivity improvements, increased digital capabilities and concentrated on global business services.

"We improved inflight dining, passenger comfort, the way in which we contact passengers and our loyalty programs. We extended our network and improved our service delivery training.''

Fuel costs for Cathay Pacific and Cathay Dragon (before the effect of fuel hedging) increased by HK$7.54 billion, or by 31.1 percent, from 2017. Fuel unit consumption rates fell by 1.3 percent reflecting continued investment in more fuel efficient aircraft. Fuel hedging losses were also reduced.

After taking hedging losses into account, fuel costs increased by HK$2.75 billion or 8.9 percent, from 2017.

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