Cathay Pacific almost doubled its net profit last year, helped by falling fuel prices and growing passenger numbers.
The high passenger load factors experienced in the first half of the year continued in the second half. Passenger numbers grew by 7.9%, driven by strong demand for economy class travel, the company said.
Premium class demand was not as strong as expected on some long-haul routes. Air cargo demand, which came under pressure during the second quarter of the year, remained weak in the second half. There was an improved contribution from the group’s subsidiary and associated companies.
“The operating environment was better in 2015 than in 2014, but we faced some significant challenges, which we expect to continue in 2016,” the airline’s chairman, John Slosar, commented.
“Strong competition from other airlines in the region, foreign currency movements and weak premium class passenger demand will put pressure on passenger yield. Cargo demand will be adversely affected by industry overcapacity. Overall passenger demand remains strong and we expect to continue to benefit from low fuel prices. Our subsidiaries and associates are expected to continue to perform well.
“We are confident of longer-term success, and we will continue to help our passengers to travel well. In January 2016, we announced that Dragonair is to be rebranded as Cathay Dragon, as part of an effort to create a more consistent travel experience between the two airlines.
“We will continue to invest in aircraft, in our products and in the development of our network. Our financial position is strong. Supported by our world-class team, we remain deeply committed to strengthening the aviation hub in Hong Kong, our home city for the past 70 years,” Slosar said.
Meanwhile, to capitalise on growing demand for air travel in the Asia-Pacific region, Cathay said it would add 12 new Airbus A350XWB aircraft, complete with new cabins, seats and entertainment systems, to its fleet this year.
Written by Peter Needham