Cathay Pacific Airways saw profits for the first half fall marginally under pressure from currency fluctuations, an unexpected drop in traffic and the recent grounding of its Airbus A330-300 aircraft fleet.
The Hong Kong carrier reported a net profit of just above HK$1 billion ($130 million) for the six months to the end of June, which represents an underlying fall of 3.4% over the performance a year ago. Sales were up by 4%.
"Currency fluctuations, a weak summer travel market and the brief suspension of A330 operations created a number of obstacles for the airlines," says Cathay chairman Peter Sutch. The grounding of the Rolls-Royce Trent 700-powered twinjets alone is estimated to have cost the airline close to $20 million. Cathay has not officially confirmed how much the two-week shut down cost the airline, but says that it expects to be compensated by R-R. "We have made satisfactory arrangements," states Sutch.
The airline has also been suffering as the result of an appreciating US dollar against some European currencies and the Japanese yen. The airline says that yields are continuing to come under pressure. The expected boom in travel in the lead-up to the 30 July handover of Hong Kong never materialised, and instead there has been a large drop-off in traffic since May.
Interim results for Cathay Pacific's associate company, Hong Kong Aircraft Engineering, remained flat, producing a net profit of HK$23 million.
Source: Flight International
