Cathay Pacific faces a ‘substantial loss’ for first half of 2020 and more flights will be cut due to Coronavirus

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Cathay Pacific faces substantial losses in the first half of this year after making a surprise profit of HK$344 million (US$44.2 million) in the last six months of 2019, the airline has revealed.

In 2019, Cathay’s annual profits dropped 28 per cent to HK$1.7 billion last year on revenue of HK$107 billion, which came amid months of anti-government protests in Hong Kong and the changing of its CEO.

The airline said it was unclear when the tough conditions would improve, as business continued to be “extremely challenging financially”.

In March, Cathay said capacity would be reduced by 65 per cent in March and April, more than double the rate in February.

That amounts to slashing three-quarters of flights this month and the next – Based on departures from Hong Kong, there will be 35 instead of 120 daily Cathay Pacific flights, 15 rather than 80 at Asia-focused Cathay Dragon and budget unit HK Express running five flights instead of 34.

Just a month later, in April, Cathay Pacific has seen its passenger traffic collapse to as little as 0.6 per cent of its normal 100,000 daily passenger volume.

Indeed, load factors had dropped to 18.3 %

The airline has told staff, as it increased its flight reductions to 96 per cent in April;

Cathay cited that it carried only 582 customers on one day this week, representing a drop of 99.4 per cent.

Augustus Tang Kin-wing, the CEO, and Patrick Healy, the chairman, said they would take a 30 per cent pay cut from April through December, while executive directors would take a 25 per cent cut.

“A timeline for a recovery in our customer demand still remains impossible to predict,” Tang said in the memo.

Cathay has said more staff were being furloughed and stood down, taking unpaid leave in affected regions it serviced where flights have been scaled back or stopped outright.

Now, so far in April, due to the outbreak of COVID-19, Cathay Pacific is remaining operations in 15 destinations.

Cathay Pacific will operate three flights per week to 12 destinations: London (Heathrow), Los Angeles, Vancouver, Tokyo (Narita), Taipei, New Delhi, Bangkok, Jakarta, Manila, Ho Chi Minh City, Singapore and Sydney.

Cathay Dragon will operate three flights per week to 3 destinations: Beijing, Shanghai (Pudong), and Kuala Lumpur.

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