Cathay Pacific Reports 1.4 Billion Dollar Annual Profit
Cathay Pacific reported a 1.4 billion dollar annual profit. The airline targets 10 percent capacity growth despite rising fuel costs and Middle East tensions.
CATHAY PACIFIC AIRWAYS has announced plans to increase its passenger capacity by 10% this year, even as it navigates operational disruptions caused by the conflict in the Middle East. The flagship carrier of Hong Kong reported a full-year net profit of HK$10.8 billion ($1.4 billion), representing a 9.5% increase and marking its third consecutive year of profitability.
The airline's financial performance was bolstered by a 15.8% surge in passenger revenue as it expanded its long-haul network. Total revenue climbed 11.9% during the period, slightly ahead of market expectations. In light of these results, the company declared a total dividend of HK$0.84 per share for 2025, a 21.7% increase from the previous year.
However, the ongoing conflict involving the United States, Israel, and Iran has created new challenges. The situation has led to airspace closures and a doubling of jet fuel prices. CEO Ronald Lam noted that while fuel surcharges for passengers and cargo are likely to rise, fare adjustments will depend on supply, demand, and competitor actions.
"Theres quite drastic changes in terms of demand patterns due to the Middle East situation, Lam said."
Operational adjustments are already underway. Cathay has suspended its services to Dubai in the United Arab Emirates and Riyadh in Saudi Arabia through the end of March. To compensate, the airline is adding more flights to London in the United Kingdom and Zurich in Switzerland, taking advantage of increased demand for routes that avoid the Middle Eastern conflict zone.
The airline's growth strategy includes taking delivery of eight new narrowbody aircraft this year. This fleet expansion is expected to support both passenger and cargo capacity. Cargo operations, a traditional pillar of the airline's earnings, remained robust with HK$24.3 billion in revenue, aided by strong e-commerce volumes from China.
Despite the group's overall success, its budget arm, HK Express, reported a full-year loss of HK$996 million. The loss was attributed to aircraft groundings caused by engine issues and the time required for newly launched routes to become profitable. The company expects the unit to return to sustained profitability in the coming years.
