“Cathay Pacific” Expects Further Loss in 2H20 as Demand for Travel Remains Low

Hong Kong’s flag carrier Cathay Pacific Airways Ltd stated on Wednesday that it expects a loss in the second half of 2020 to be significantly higher than the first half, driven by low demand, restructuring charges and impairments on its fleet of planes.

 

The carrier reported a loss of HK$9.87 billion in the first half of 2020, mainly due to the coronavirus outbreak that paralyzed global tourism. Meanwhile, the polls by Refinitiv estimated that the airline would report a loss averaging HK$18.3 billion this year.

 

On December 16, 2020, Cathay Pacific released its traffic figures for November 2020 that continued to reflect the airline’s substantial capacity reductions in response to significantly reduced demand as well as travel restrictions and quarantine requirements in place in Hong Kong and other markets amid the ongoing global COVID-19 pandemic.

 

The airline stated that it carried a total of 37,815 passengers last month, a decrease of 98.6% compared to November 2019. The month’s revenue passenger kilometres (RPKs) fell 97.9% year-on-year. Passenger load factor dropped by 61.5 percentage points to 18.5%, while capacity, measured in available seat kilometres (ASKs), decreased by 90.9%.

In the first 11 months of 2020, the number of passengers carried by Cathay Pacific and Cathay Dragon dropped by 85.8% against a 77.7% decrease in capacity and an 83.8% decrease in RPKs, as compared to the same period for 2019.

 

Meanwhile, Cathay Pacific carried 116,853 tonnes of cargo and mail last month, a decrease of 34.3% compared to November 2019. The month’s revenue freight tonne kilometres (RFTKs) fell 26.2% year-on-year. The cargo and mail load factor increased by 9.0 percentage points to 77.7%, while capacity, measured in available freight tonne kilometres (AFTKs), was down by 34.7%. In the first 11 months of 2020, the tonnage carried by Cathay Pacific and Cathay Dragon fell by 34.3% against a 35.3% drop in capacity and a 27.2% decrease in RFTKs, as compared to the same period for 2019.

 

“Looking ahead on the passenger front, we still are not seeing significant demand for travel as we head towards the end of 2020 – traditionally a strong travel season in the year. Demand continues to weaken on long-haul routes and we anticipate we will rely more on traffic on regional services in the immediate future. Given the slow speed of recovery, we expect to operate about 9% of pre-COVID-19 capacity in December and slightly above 10% in January 2021,” said Cathay Pacific in its statement.