Cathay Pacific Sees Major Profit Turn Around in 2018
Cathay Pacific is finally seeing an increase in profit after two years of financial loss.
The Hong Kong-based carrier said Wednesday that a preliminary review of the unaudited consolidated management accounts show profits for 2018 to be 2.3 billion HKD ($293 million USD)— a major increase compared to last year's report.
In 2017, Cathay saw a loss of about $160 million USD in profits— which was nearly double the amount that the airline lost the year before. The airline attributed most of these losses to an 11.3% increase in its already pricey fuel bill, which accounted for about a third of the company's expenses. However, as One Mile at a Time points out, other issues stemmed from more competition and too much capacity on key routes and aircraft that are not efficiently configured to maximize revenue.
As for why the staggering increase in profits occurred last year, Cathay highlighted a three-year company restructuring that focused on capacity growth, customer service and management of revenue for its passenger business. This process has led to the airline cutting some of its routes, reducing its workforce, and an ongoing mass reconfiguration project that will transform 68 of its 777s to 10-across seating in economy. They'd also taken on new leadership under CEO Rupert Hogg in mid-2017.
Cathay plans on releasing a fully consolidated review of its 2018 profits in March.