HONG KONG: The Cathay Pacific Group has reported a profit of HK$1,972 million (US$254 million) for the first six months of 2015. This compares to a profit of HK$347 million (US$44.7 million) in the first half of 2014.
Revenue for the period fell 0.9 percent to HK$50.4 billion (US$6.5 billion).
The company said an increase in demand in air cargo that began in the Summer of 2014 continued in the first part of 2015, but demand slackened in the second quarter. The group's cargo revenue for H1 was HK$11,376 million (US$1.46 billion), a drop of 2.5 percent year-on-year.
Strong competition, overcapacity and a significant reduction in fuel surcharges saw yield fall 11.1 percent to HK$1.93 (US$0.25 cents).
Demand remained high on routes to and from North America due to backlogs caused by the industrial action at at U.S. West Coast ports. Intra-Asia shipments rose but traffic to Europe "fell short of expectations", said the company.
In the first six months of 2015, Cathay took delivery of four B777-300ERs and three A330-300s. In 2013 it was agreed that six Cathay B747-400F freighters would be sold back to Boeing. One was delivered in November 2014, the other in July 2015. The remaining four freighters will leave the airline by the end of 2016.
Commenting on the H1 results Cathay Pacific chairman John Slosar said that while the operating environment was "generally positive" the group faces challenges: "Yield remained under pressure and there is increasing congestion at Hong Kong International Airport (right). We strongly support the construction of a third runway at the airport and believe that construction should start as soon as possible. We think the airport authority Hong Kong can, and should, finance the construction itself without burdening airport users unduly with additional charges. Airport charges must be competitive if Hong Kong's aviation, tourism and related industries are to continue to grow."
July cargo traffic for Cathay Pacific and Dragonair saw only a marginal increase. The two airlines carried 147,545 tonnes of cargo and mail during the month, a rise of 0.5 percent compared to the same month last year. The cargo and mail load factor fell by 2.9 percentage points to 61.8 percent.
General manager Cargo Sales & Marketing Mark Sutch remarked: "After a flat second quarter, demand for airfreight shipments remained below expectations throughout July. The growth in tonnage lagged the growth in capacity by a sizeable margin, which dragged down the month's load factor. Yield remained under pressure due to overcapacity in a number of markets. Among the positive stories of the month, demand into and out of India continued to be ahead of expectations and we also saw an upsurge in project shipments out of Western China, and Chongqing in particular."