Cathay Pacific Airways today announced a profit attributable to shareholders of HK$657 million in 2001, compared to the record result of HK$5,005 million achieved in 2000. Turnover fell by 11.8% to HK$30,436 million, whilst operating profit fell by 84.3% to HK$832 million. The directors have recommended a final dividend of HK 5 cents a share, 88.9% lower than in 2000.
A profit of HK$1,319 million in the first half of the year swung into a loss of HK$662 million in the second half as a result of the deepening global economic slowdown and the tragic events of September which severely reduced demand for air travel.
For the year as a whole, the airline carried 11.3 million passengers, 5% lower than the previous year. Demand for business and first class travel was particularly weak, and the fall in demand for air travel prompted intense competition and widespread discounting in many of the markets we serve. As a result, passenger yield declined and was, on average, 5.2% below the 2000 level.
The air cargo market was also affected by the global economic slowdown, with Cathay Pacific`s cargo turnover falling 15.6% to HK$7,272 million. As a result of excess capacity and intense competition, cargo yields fell by 10.6%. The amount of cargo carried fell by 8.5% to 704,154 tonnes.
In 2001, Cathay Pacific further strengthened its regional network by launching services to Delhi, Riyadh and Sapporo. However in view of weak passenger demand, services to Zurich, Manchester and Istanbul were suspended during the year. The resumption of service to these destinations would be kept under review
Despite the difficult operating environment, Cathay Pacific remains committed to providing passengers with superior products and services. During the year, Cathay Pacific introduced the new Business Class cabin to its long-haul fleet, launched various e-Business initiatives including the world’s first inflight email service and opened a new lounge, The Pier, at Hong Kong International Airport.
Cathay Pacific Chairman Mr James Hughes-Hallett, said: “The year 2001 brought many challenges. Despite the very difficult market conditions, Cathay Pacific continues to invest in both product and customer service. We are well positioned to benefit once global economic conditions begin to improve.”