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HONG KONG (BLOOMBERG) – Cathay Pacific Airways is still consuming up to HK $ 2 billion (S $ 352 million) a month and will continue to do so until the market recovers from the coronavirus crisis, the airline said on Monday (September 14). ). as it reported appalling traffic figures for August and reiterated the need for a restructuring.
“We are weathering the storm for now, but the fact is that we simply will not survive unless we adapt our airlines for the new travel market,” said Chief Commercial Officer Ronald Lam in a statement.
“Therefore, a restructuring will be inevitable to protect the company, the Hong Kong aviation hub and the livelihoods of as many people as possible,” Lam said. A HK $ 39 billion recapitalization plan that was completed last month took the company some time, but “it is an investment that we have to repay,” he said.
Cathay, which reported a HK $ 9.9 billion net loss in the first half last month, is undergoing a strategic review. Recommendations on the future shape and size of the airline, which includes Cathay Dragon and HK Express, will be presented to the board in the fourth quarter.
Cathay and Cathay Dragon carried just 35,773 passengers in August, a 98.8 percent drop from the same month last year. Revenue per passenger-kilometer fell 98.1 percent and passenger load factor fell 60 percentage points to 19.9 percent, the company said on Monday (Sept. 14). The group transported 102,122 tons of cargo, 36.7% less than in August 2019.
“It is clear that we face a long and uncertain road to recovery,” Lam said.
With little sign of improvement, with the ban on pickup from some services thanks to student traffic to the UK and the lifting of the ban on transit flights from mainland China, Cathay has reduced its operational capacity of passenger flights to around 10% in September and October. .
“Passenger demand remained very weak, as new waves of Covid-19 in our key markets reduced overall travel confidence,” Lam said. “As no new destinations were resumed in August, we only saw a minimal increase in passenger flight capacity.”
Cathay shares fell 0.3% in Hong Kong trading on Monday. They have plummeted 38 percent this year.
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