Hong Kong flag carrier Cathay Pacific Airways Ltd (國泰航空) yesterday said that it is expected to have swung back to profit last year, ending two years of losses, despite suffering an embarrassing data breach at the end of last year.
The airline expects to record a consolidated profit of about US$293 million, compared with US$160 million losses the year before, according to a preliminary profit alert.
The company’s share price jumped more than 6 percent after the announcement as investors took comfort in the turnaround after two grim years for Asia’s largest carrier.
“In 2018, the passenger business benefited from capacity growth, a focus on customer service and improved revenue management,” the company said in a statement, adding that its cargo sector was also “strong.”
Cathay has been overhauling its business after posting it first losses in eight years in 2016, firing more than 600 workers, and paring overseas offices and crew stations as it faced stiff competition from budget rivals in China.
It also added international routes and better services on board its flights in a bid to compete with well-heeled Middle Eastern long-distance carriers.
The profit alert suggests that the moves have paid off.
The airline narrowed its losses to US$33.5 million in the first half of last year — a 10th of what they were for the same period in 2017.
The second half of the year appears to have brought Cathay squarely back into the black.
Cathay is expected to further benefit from the end of costly fuel-hedging contracts this year, Kingston Securities (金利豐證券) analyst Dickie Wong (黃德几) said.
“I would say the unfavorable impact to Cathay would continue to reduce,” he added.
The introduction of premium economy had attracted new customers, while ticket discounts helped it compete against budget carriers, he said.
However, the company still had “much room to improve in their luxury classes” if it wants to take on Middle Eastern rivals, Wong added.
Cathay is to announce its full-year result next month.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
RSS