Cathay lowers profit forecast; cancels hosting of AAPA Assembly of Presidents

Hong Kong’s protests continue to plunge the city into chaos, not only crippling metro, bus and cross-border services, but also shutting offices, shopping malls, schools and universities.
Clashes between police and protesters, which started more than five months ago, have at some point even extended to Hong Kong’s Chek Lap Kok airport, disrupting travel and operations at one of
Asia’s busiest airports.

Although air cargo operations have remained relatively unscathed, as exemplified by last week’s announcement by Hong Kong Air Cargo Terminals Ltd (Hactl) that it handled 104 freighter aircraft on
one day, the situation at Cathay Pacific looks rather bleak with the Group last week announcing further downward trends for its full-year profit forecast.

“Uncertain” outlook
The airline, which has been under pressure from Beijing to rein in staff taking part in unauthorised protests and has been rocked by resignations and reshuffles among its senior management,
warned that the second half of 2019 would be “significantly below” the first six months of the year and the short-term outlook remained “challenging and uncertain”. While the declines are
predominantly passenger-related, the airline also carried 6.6% less cargo over the first 10 months of the year.
While Cathay reported a profit of HK$2.34 billion (US$298 million) in 2018 after two consecutive years of losses and this year it made a first-half profit of HK$1.35 billion, analysts point out
that with steep drops in China traffic (-21.9%), operating data for October show no notable improvements in passenger demand from the past several months.
As a result, analysts predict that it will be more likely that Hong Kong’s flagship carrier will report an annual loss for the third time in four years.

Cathay lowers short-term outlook due to Hong Kong protests  -  company courtesy
Cathay lowers short-term outlook due to Hong Kong protests – company courtesy


AAPA cancelled due to unpredictable situation
With no signs that Hong Kong’s protest crisis and the resulting chaos will be ending any time soon, the airline, after consultation with the Association of Asia-Pacific Airlines (AAPA) said in a
joint statement on Wednesday that it would not be hosting the AAPA’s annual 63rd Assembly of Presidents on 21-22 November 2019.
AAPA director general, Andrew Herdman and Cathay Pacific Group CEO Augustus Tang Kin-wing, stated that the decision was “very difficult given our commitment to organise this important industry
event, but reflects the unpredictability of the situation in Hong Kong.”
The statement added that “the well-being of our delegates and guests has always been of paramount importance” and “AAPA deeply regrets the inconvenience and disappointment caused by this change
of plans.”

Nol van Fenema



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Source: Cargoforwarder

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