HONGKONG: The Cathay Pacific Group has reported a profit of HK$3.15 billion for 2014 - up from HK$2.6 billion the previous year - on a 5.5 percent increase in turnover to HK$106 billion.
During the first half of 2014 the group said its business was affected by high fuel prices, reduced passenger yield and continued weakness and over-capacity in air cargo. However airfreight demand started to improve in the summer and was strong in the fourth quarter. The airline finished the year with a 7.3 percent increase in overall cargo revenue of HK$25.4 billion.
Overcapacity continued to pressure rates for the first six months and by the end of 2014 yields for both Cathay Pacific and Dragonair had fallen 5.6 percent year-on-year to HK$2.19 while capacity rose 10.4 percent.
The company said its new cargo terminal "worked effectively" in its first full year of operation as it began to dispose of six B747-400 freighters – all of which will have left the fleet by 2016. The airline began cargo services to Columbus, Calgary and Phnom Penh in 2014 and added Kolkata to its freighter network in March 2015.
Cathay chairman John Slosar commented: "It was encouraging to see an overall improvement in our business in 2014. That improvement has continued in the first quarter of this year and we are positive about the overall prospects for 2015. Demand in our cargo business continues to improve and is currently being helped by the congestion in seaports on the West Coast of the United States."
Meanwhile the airline has announced it will stop flying three times a week between Hong Kong and Moscow in June this year due to what it described as "commercial reasons". Cathay, which began its Moscow service (above) in July 2010, said it will begin flights to Zurich at the end of March and Dusseldorf in September.