Cathay Pacific reports diving profits amid rising cost of fuel
Cathay Pacific’s share price plunged to an eight-month low this morning after the Hong Kong airline reported surprise losses for the first half of the year.
Rising fuel costs pushed the carrier’s losses down to HK$260m (£26m) in the first six months through June, despite expectations that the firm was set for profits of up to HK$140m.
Shares fell as much as 3.3 per cent on the back of the news this morning, which come several months after Cathay reported consecutive annual losses for the first time in its history.
Overall costs at the company rose 8.5 per cent to HK$53.3 billion in the first six months of the year, largely due to a rise in fuel costs and aircraft maintenance.
John Slosar, chairman of Cathay Pacific, said: “Our airlines usually perform better in the second half of the year than in the first half of the year. We expect this to be the case in 2018.”
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Slosar also warned of economic “uncertainty” driven by the looming trade war between China and the US which could hurt the airline’s cargo profits.
However, revenues for the Hong Kong-based firm jumped 15.7 per cent over the six month period, hitting an all-time high of HK$53 billion on the back of strong performances in both its cargo business and a rise in airfare prices.