Home > Home > Cathay Pacific Shares Head for the Worst Annual Decline in 18 Years

Cathay Pacific Shares Head for the Worst Annual Decline in 18 Years

12/30/2008| 10:55:00 AM| 中文

Monday, December 29, 2008: Cathay Pacific Airways Ltd. shares are set to experience their biggest annual decline in at least 18 years after battling record fuel prices and a global recession.

Monday, December 29, 2008: Cathay Pacific Airways Ltd. shares are set to experience their biggest annual decline in at least 18 years after battling record fuel prices and a global recession.

Cathay Pacific shares plunged 2.2 percent to HK$8.30 at the lunchtime trading break on Tuesday, extending losses for the year to 59 percent.

China Southern Airlines Co., Asia´s largest carrier by passenger numbers, has fallen by 81 percent in the city.

Qantas Airways Ltd. is also experiencing turbulent times, with reports indicating that the airline is heading for its worst year in more than a decade.

The recession has brought about a decline in international travel demand, with Cathay Pacific, Qantas and other carriers attempting to combat this trend by cutting capacity, offering unpaid leave or firing employees.

Soaring fuel prices (which have doubled in a year) also boosted costs before a 67 percent decline in prices led to hedging losses.

“It´s been a bad year for stocks,” said Jack Xu, an analyst at Sinopac Securities Co. in Shanghai. “Airlines are losing passengers as a chain reaction from the economic slowdown.”

Cathay Pacific, Hong Kong’s largest carrier, has reported a decline in passenger numbers in two of the last three months with figures falling by 2.2 percent last month.

The airlines first and business-class sales have also plunged 26 percent in the week ended Dec. 13, the South China Morning Post reported, citing comments made by CEO Tony Tyler.

Scary Projections

Projections for Cathay Pacific’s business in the coming months are “scary,” Tyler said in the company´s internal magazine this month.

“We´re facing very uncertain times and the mood has turned decidedly somber,” Tyler said.

The airline posted its first half-year loss in five years in the six months ended June and has also forecasted “disappointing” full-year earnings and a possible HK$2.8 billion ($361 million) loss from fuel-hedging.

“Cathay Pacific´s sales won´t recover until the second half of next year,” said Xu.
TAGS: Cathay Pacific | China Southern | Qantas Airways
©2016 广州力矩资讯科技有限公司 粤ICP备06070077号-2
Tell us more about yourself!