Cathay Pacific expects up to $576 million first-half profit as demand rebounds

(Reuters) -Hong Kong’s Cathay Pacific Airways (OTC:) said on Friday it expects to record a profit of up to HK$4.5 billion ($575.85 million) in the first half of the year as travel demand skyrockets on border reopenings.

Cathay Pacific took in record losses for the last three years as it parked much of its fleet during the pandemic amid COVID-related flight cancellations and drastic headcount cuts.

That is turning around as passengers flock in huge numbers to travel overseas, with Cathay Pacific carrying a total of about 7.82 million passengers in the first-half, compared with a paltry figure of 335,462 last year.

“Our long-haul routes popular for student traffic, such as North America, the UK and Australasia, all saw good demand,” the 76-year-old airline said.

As a result, its passenger load factor was 87.2% for the first-half, compared with 59.2% last year.

Airlines around the world are benefiting from a rebound in travel which has far exceeded their expectations, prompting carriers to scale up their fleet, improve flight frequencies, and add new destinations.

“Turning to July and August, on the travel side the outlook is encouraging,” Cathay Pacific said.

While cargo demand was expected to remain flat during the summer period, the carrier was preparing for demand to pick up in latter part of the third quarter, it added.

Hong Kong’s flagship carrier expects first-half consolidated profit attributable to shareholders between HK$4 billion and HK$4.5 billion, including a one-off gain from the near 1.9% stake sale in Air China (OTC:).

It lost HK$5.00 billion a year ago.

For the fiscal 2023, Cathay Pacific is expected to log profit of HK$3.92 billion, according to a Refinitiv estimate, a huge swing from HK$7.16 billion loss last year.

($1 = 7.8146 Hong Kong dollars)

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