Improvement in cargo demand beginning in the summer of 2014, followed by a strong fourth quarter for cargo, led to increased profit for the carrier last year. The Cathay Pacific Group reported attributable profit of US$406 million for the year, compared to US$337 million in 2013. The group’s cargo revenue in 2014 increased by 7.3 percent to US$3.27 billion.
Yield for the full year at Cathay Pacific and its wholly owned subsidiary, Dragonair, decreased by 5.6 percent, although there was increased cargo demand in the second half of the year. Capacity in 2014 increased by 10.4 percent. The carrier’s load factor increased by 2.5 percent to 64.3 percent. In the second half of the year, an almost-full freighter schedule was operated at all times. Additionally, the new Cathay Pacific cargo terminal at HKIA worked in the company’s favor, making the carrier’s cargo operations more efficient.
In spite of the drop in fuel prices that began in the second half of 2014, fuel costs for Cathay Pacific rose by 0.7 percent compared to 2013. Although fuel consumption increased during the year, the increase in fuel costs moderated somewhat by the use of more-fuel-efficient aircraft and the retirement of less-fuel-efficient planes. Fuel costs were 39.2 percent of total operating cost compared to 39 percent in 2014.
The Cathay Pacific Group took delivery of 16 new aircraft in 2014, including nine 777-300ERs and five Airbus A330-300s for Cathay Pacific, and two A321-200s for Dragonair. The company retired six 747-400 passenger planes last year. In 2013 it sold six 747-400Fs back to Boeing.
New frequencies for Cathay Pacific Cargo that were introduced last year include Columbus in the U.S.; Calgary in Canada; and Phnom Penh in Cambodia. The airline just added Kolkata to its network this month.
In 2014, the group and Air China, one of its major shareholders, made a substantial injection of capital and loans into Air China Cargo. This will allow Air China Cargo to buy new aircraft and improve the performance of its cargo business.
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