Cathay Pacific first-half profit drops 59% on high fuel prices

Cathay Pacific Airways blamed high fuel prices for a 59% year-over-year drop in net profit to HK$2.8 billion ($359 million) for the first six months of 2011 (ATW Daily News, Aug. 5, 2010).

The slump comes despite a 13.2% increase in half-year revenue to HK$46.8 billion.

The airline said that increased jet fuel prices had a significant effect on operating results in the 2011 first half. CX and affiliate Dragonair carried 13.2 million passengers during the six months, up 1.7% over 2010. Load factor fell by 4.7 percentage points while yield increased 11.8% to HK0.653.

CX reported that its cargo business performed reasonably in the 2011 first quarter, but demand out of its two most important markets, Hong Kong and Mainland China, weakened significantly from April onward. First-half 2011 cargo yield was up 7.1% to HK$2.42 while capacity heightened 14.6%. Cargo load factor fell 9.6 points to 68.4%.