Cathay Pacific Announces 2006 Annual Results
Cathay Pacific Airways Limited | Mar. 07, 2007
On March 7, Cathay Pacific Airways announced a profit attributable to shareholders of HK$4,088 million in its 2006 annual results, compared to a profit of HK$3,298 million the previous year. The 2006 results include a three-month contribution from Dragonair, which became a wholly owned subsidiary of Cathay Pacific on 28 September 2006.
Group turnover again hit new highs, increasing 19.4% to a record HK$60,783 million. High fuel prices, though they eased a little in the latter part of the year, continued to have a significant impact on the airline in 2006. The fuel bill for the year was HK$20,214 million - up 29.7% on the previous year - with fuel surcharges only partially offsetting continued high fuel costs. Efforts by the airline to increase productivity and reduce controllable overheads led to a 1.3% fall in unit cost excluding fuel.
The airline carried a record 16.7 million passengers in 2006, up from 15.4 million the previous year. Passenger revenue also hit a new high, rising 10.9% to HK$33,585 million, while continued strong demand from first and business class passengers helped to push yield up by 1.5% to HK47 cents. Capacity, measured in terms of available seat kilometres, increased by 7.7% as the airline added new aircraft and further expanded its network.
The airline added two more passenger aircraft to its fleet last year, an Airbus A330-300 and a Boeing 777-300, and launched its latest passenger destination with a daily service to Shanghai. The airline added more flights to Adelaide, Bahrain, Dubai, Frankfurt, Riyadh, Rome and Seoul, upgraded three Penang flights a week to a direct service, and added Kota Kinabalu and Phuket as destinations through a code-share arrangement with new subsidiary Dragonair.
Cathay Pacific expanded its freighter network and fleet in 2006, helping it carry a record 1,199,000 tonnes of freight. Cargo revenue also hit a new high, rising 3.4% to HK$11,980 million. The cargo load factor increased by 1.3% points to 68.3%. However, increased competition and a weakened demand for exports out of Australia, Europe and the United States led to a decrease in cargo yield to HK$1.69. The new freighter destinations added were Beijing, Chennai, Stockholm and Toronto, while two Boeing 747-400BCFs, Boeing Converted Freighters, swelled the freighter fleet to 18.
Cathay Pacific further cemented its status as Hong Kong's home carrier in 2006, with the Dragonair integration and enhanced partnership with Air China giving an added boost to Hong Kong's position as a leading international aviation hub and gateway to Mainland China. The carrier announced an order for six Boeing 747-400ERFs, Extended Range Freighters, for delivery commencing May 2008, and also took up two more options on the Boeing 777-300ER, Extended Range passenger aircraft, to take its total order to 18. These aircraft begin arriving in September this year featuring Cathay Pacific's new three-class long-haul product.
Cathay Pacific Chairman Christopher Pratt said: "Business was strong in 2006, with passenger demand in particular holding up well. However, high fuel prices continued to have an impact, despite easing off a little in the latter part of the year. Last year was a very significant one for Cathay Pacific as it celebrated its 60th anniversary as Hong Kong's home carrier and sealed the deal that brought Dragonair into the Cathay Pacific Group and at the same time enhanced the airline's strategic partnership with Air China. The synergies of that deal will begin to emerge more significantly in 2007, though we expect to face challenges from ever-increasing competition and high, volatile fuel prices."
Results |
2006 |
2005 |
Change | |
Turnover | HK$ million |
60,783 |
50,909 |
+19.4% |
Profit attributable to Cathay Pacific shareholders | HK$ million |
4,088 |
3,298 |
+24.0% |
Earnings per share | HK cents |
115.9 |
97.7 |
+18.6% |
Dividend per share | HK cents |
84.0 |
48.0 |
+75.0% |