Cathay Pacific says 2012 net profit slumps 83.3%

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01:40 PM March 13th, 2013

March 13th, 2013 01:40 PM

HONG KONG, China—Cathay Pacific said Wednesday 2012 net profit plunged 83.3 percent, as the Hong Kong flag carrier was hit by persistently high fuel prices and weak air cargo demand.

The airline said profit stood at HK$916 million ($118 million), down from the HK$5.5 billion it recorded in 2011. Revenue rose 1.0 percent to HK$99.4 billion from HK$98.4 billion in 2011.

“Economic uncertainty, particularly in the eurozone countries, and an increasingly competitive environment added to the difficulties,” chairman Christopher Pratt said in a statement to the Hong Kong stock exchange.

“It was a challenging year for the aviation industry generally.”

Cathay said it carried a total of 29.0 million passengers in 2012, a 5.0-percent rise year on year, but its premium class business was affected by travel restrictions imposed by companies.

“The high cost of fuel made it more difficult to operate profitably, particularly on long-haul routes operated by older, less fuel-efficient, Boeing 747-400 and Airbus A340-300 aircraft,” Pratt said.

He added that the cost of fuel, which accounts for 41.1 percent of total operation costs, rose 0.8 percent year-on-year in 2012.

The blue-chip Asian airline in August posted a first-half year net loss of HK$935 million.

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