Cathay Pacific obtains 1.77 billion HK dollars of half-year profit

Cathay Pacific Airways said Wednesday that it obtained 1.77 billion Hong Kong dollars (227 million US dollars) of the first half-year net profit on strong rebound of Hong Kong's economy and increasing of new services.

Cathay said in its 2004 Interim Results published Wednesday that this was in marked contrast to the 1.24 billion HK dollars (159 million US dollars) of loss recorded during the SARS-affected first half of 2003.

Cathay believed that an improving world economy and a strong recovery in Hong Kong propelled growth in both the airline's passenger and cargo operations. The airline responded by introducing new services and additional frequencies across its network.

Cathay said the number of passengers carried increased 59.3 percent to 6.4 million in the first half of this year and cargo volumes increased 15.8 percent to 469,909 tons due to continued growth of re-exports from southern China and higher volumes carried on trunk routes to Europe, Japan and the United States.

However, Cathay said the higher revenues were partially offset by higher costs arising from the sharp rise in the price of fuel.

The average price before hedging was 16.9 percent higher than in the same period last year. Fuel accounted for 21.8 percent of the airline's operating costs during the period.

Cathay Pacific Chairman James Hughes-Hallett said: "prospects for the traditionally stronger second half of the year appear to be good, although the high fuel price remains a concern, which if sustained, could dampen global economic growth and the demand for air travel. We remain optimistic over our future and will continue to develop our network, strengthen Hong Kong as a global aviation hub and focus on delivering superior value to customers."