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Hong Kong‘s Cathay Pacific Airways said on July 14 it expects to record a profit of up to HKD 4.5 billion (USD 576 million) in the first half of the year as travel demand skyrockets on border re-openings.
Cathay Pacific booked record losses the last three years as it parked much of its fleet during the pandemic amid Covid-related flight cancellations and drastic headcount cuts.
That is turning around as passengers flock in huge numbers to travel overseas, with Cathay Pacific carrying a total of about 7.82 million passengers in the first-half, compared with a paltry 335,462 last year.
“Our long-haul routes popular for student traffic, such as North America, the UK and Australasia, all saw good demand,” the 76-year-old airline said.
As a result, its passenger load factor was 87.2% for the first-half, compared with 59.2% last year.
Cathay Pacific’s shares rose as much as 6.3% after the announcement to their highest in nearly seven months, beating a 0.3% gain for the benchmark Hong Kong index.
Airlines around the world are benefiting from a rebound in travel that has far exceeded their expectations, prompting carriers to scale up their fleet, improve flight frequencies and add new destinations.
Air China, China Eastern Airlines, Cathay Pacific and Hainan Airlines have in the past four months launched a total of 16 weekly flights to Madrid and Barcelona from Beijing, Shanghai, Hong Kong and Chongqing, according to Turespana. In late 2022, Chinese airlines operated only three flights. Spain received 700,000 Chinese visitors in 2019.
“Turning to July and August, on the travel side the outlook is encouraging,” Cathay Pacific said. While cargo demand was expected to remain flat during the summer period, the carrier was preparing for demand to pick up in latter part of the third quarter, it said.
Hong Kong’s flagship carrier expects first-half consolidated profit attributable to shareholders between HKD 4 billion and HKD 4.5 billion, including a one-off gain from the near 1.9% stake sale in Air China.
It lost HKD 5.00 billion a year ago.
For the fiscal 2023, Cathay Pacific is expected to log profit of HKD 3.92 billion, according to a Refinitiv estimate, a huge swing from HKD 7.16 billion loss last year.
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