In: Other Topics

Submitted By kkgkkj
Words 371
Pages 2
Cathay Pacific Airways announced earnings well below expectations yesterday as yield pressure on regional routes and a weak cargo market derailed recovery efforts. The world's biggest international air cargo carrier posted net profit of HK$24 million in the first half of the year, far below the HK$600 million expected by analysts.
Cathay's ambitions to achieve a significant turnaround was also stymied by the losses generated from its air cargo joint venture, Air China Cargo, and establishment losses at its HK$5.9 billion cargo terminal at the airport that opened in February.
Still, thanks to lower jet fuel prices and stronger passenger demand, the company recovered from its HK$929 million loss in the same period last year. Turnover declined 0.6 per cent to HK$48.6 billion.
"The fortunes of the airline industry correlate closely with the world economy so we don't expect to see any sustained pickup in business until the world economy is on a surer footing," chairman Christopher Pratt said.
Airline operations in the past six months achieved HK$452 million in pre-tax profit, against HK$1 billion in losses last year.
Passenger yield and load factor improved, helped by a nearly 5 per cent cut in capacity in the first half after the early retirement of four Boeing 747-400s and the reduction in long-haul routes.
Reductions in capacity will ease to 1.5 per cent for the full year with the arrival of three B777s in the second half of the year.
Cathay will restore by next month all the long-haul passenger flights cancelled as part of a wave of cost-cutting last year.
Its profit was dented by a loss of about HK$400 million in Air China Cargo, of which it owns 49 per cent, and the HK$350 million loss in the cargo terminal in the first half.
"We hope that the operation at Air China Cargo will improve in the second half as we will replace B747-400s freighters with more…...

Similar Documents

Cathay Pacific General Environment

...Analysis of Cathay Pacific Airlines General Environment Cathay Pacific was established in 1946 and is now the largest airline company in Hong Kong. It operates both passenger services and cargo services and operates in more than 30 countries throughout Asia, the Pacific, the Middle East, Africa, Europe and North America to more than 80 destinations. From Hong Kong, where its headquarter is based, Cathay operates 36 of their destinations in the Asia-Pacific region. Therefore the general environment in especially Hong Kong and the rest of the Asia-pacific region has an effect on Cathay Pacifics business procedure. The general environment is composed of factors that can have dramatic effects on a firm’s strategy and events and changes in the general environment can he hard to predict and even harder to control (Dess et al. 2012, p.87). The demographic segment of the general environment is the genetic and observable characteristics of a population (Dess et al. 2012, p. 87). Hong Kong’s population was in 2009 7.03 million. About 95% of the population are of Chinese descent. The majority are Taishanese, Chiu Chow, other Cantonese people, and Hakka. The remaining 5% of the population is non-ethnic Chinese people and consists of a South Asian population of Indians, Pakistanis, Neplaese, Vietnamese refugees, Europeans, Americans, Japanese and Koreans. This means that the population of Hong Kong consists of many different nationalities and in addition Hong Kong is one of the......

Words: 1059 - Pages: 5

Competitor Analysis

...Competitor Analysis of Cathay Pacific Airlines Cathay Pacific Airways is an international airline registered and based in Hong Kong, offering scheduled cargo and passenger services to more than 110 destinations around the world. The main competitors of Cathay Pacific are Singapore Airlines and China Southern Airlines . In this competitor analysis for Cathay Pacific we will assess China Southern Airlines only. 1. What are the objectives of this competitor? The objectives of China Southern Airlines are as follows: * To build an international network-oriented airline with core competitiveness and sustainable profitability. * Core value of "customer first * striving for excellence * continuous innovation and contributing to the society", and the vision and mission of "becoming the most favorite airlines for both customers and employees 2. What is its current strategy? Currently, China Southern operates more than 460 passenger and cargo transport aircraft, including Boeing 777, 747, 757 & 737 and Airbus A380, 330, 321, 320, 319. The airline fleet is ranked among the world’s top six airlines (in terms of fleet size) and with Guangzhou and Beijing as its central hubs, the carrier boasts a substantial route network spanning more than 150 destinations in China and more than 40 destinations in Asia with service to Europe, America, Australia and Africa.. * Substantial Flight Capabilities China Southern continues to be a leader in the Chinese......

Words: 622 - Pages: 3

Sama Part 5 Force

...2.Evaluation of Business Environment (SWOT/5-Forces Model) 1. Evaluate the progress Cathay Pacific has made on outsourcing their IT activities. Do their ideas make sense to you? Why? 1. Threat of new entrants--LOW * Large capital requirements * Industry regulation * Technical requirements * Pilot shortages * Government control () The airline industry requires large capital and high technical. Also, there are a lot of regulations within the industry. And many government now put pressures on new start-up aviation companies, take China as an example, Civil Aviation Administration of China now do not approve to set up new airline companies. New entrants into this field would face large barriers. Thus, the treat of new entrants is low. 2. Threat of substitutes—Medium * International routes-shipping * Domestic routes Long distance bus Railway High-speed rail… In the international routes, the substitute for airline is shipping. In domestic routes, the substitutes are long distance bus, railway, and high-speed rail. Although, these would take more time to reach destination. However, they are cost- effective choices especially the high-speed rail comparing with airplane. High-speed rail is gradually operating in a large scale with convenience and comfort. There is a saying that in the future, once the airplane could reach, so could high-speed rail. So we judge the threat of substitutes is medium. 3. Bargaining power of suppliers—LOW ...

Words: 561 - Pages: 3


...Background: - Cathay Pacific was founded in Hong Kong on september 24 1946 - it is held amongst two, Roy Farrel and Sydney de Kantzow - as mentioned in the video, in its early stages, cathay pacific only flew to few routes between hong kong, sydney, manila, singapore - when it bought butterfield and swore it expanded its fleet and its destinations routes to European and North American countries. - this has continued to the current days in their developments Future Forecast: - in the short term, revenue of cargo may increase because cathay pacific is introducing new cargo terminals in hong kong this year - the firm has ordered around 92 fleets expecting to introduce new flights and destinations which will allow it to increase Industry Comparison: - revenue: throughout the years, it is shown that british airways' revenue has been higher than cathay pacific, because of the financial crisis in 2008, they had begun to face negative drawbacks and growth, they began to operate in different markets and expand their fleets and destinations which had allowed their revenue to increase, british airways was bound to take such an action in order for them to keep gaining profit and remain in the industry, as the scale of the company grows the revenue will increase with it - expenses: we can also notice that both company's share similar expenses where as their revenues have a drastic difference, this shows that cathay pacific may be more efficient in delivering their service...

Words: 260 - Pages: 2

Cathay Pacific

...| |Cathay Pacific | Memo To: Edward Nicol, Director of IM From: Anthony Yeung, General Manager of IM CC: Jakob Iverson Date: 2/05/2003 Re: Cathay Pacific Outsourcing Process Edward, Once again, welcome back to Cathay Pacific! I thought I would take time to articulate the current state of Cathay’s outsourcing processes and more importantly present my recommendations to revise our methodology in managing our strategic partners that will enable future success. Understanding we are in a mode to reduce costs to compete in this industry, Cathay has outsourced several key IT functions over the past 5 years, with now 65% of our operating budget being managed outside of Cathay. Our first two major initiatives, dubbed “smartsoucing”, were initiated in April 2007. We outsourced our infrastructure to IBM and our applications to SABRE Airline Solutions. Although these two vendors were not exclusive vendors, it was clear they were definitely preferred! In December 2007, we outsourced our data center that we had built in 1995 to IBM as well. In 2001, we outsourced our desktop environment also to IBM. We followed that up in November 2002, when we outsourced our e-business infrastructure to Hewlett-Packard. Edward, listed below is my assessment of the......

Words: 817 - Pages: 4


...advantages of this. Firstly due to this expansion this could increase the sales for Cathay and due to this an increase in their profits. If Cathay are able to gain more profit this will be a huge benefit for Cathay. There are some downsides to this new rule and some of the reasons why Cathay might not be well suited with this new rule. This will most likely cause Cathay to spend more on new planes, pilots and staff. Also it takes a long time for planes to be made around 2 to 3 years. This will be seen in a long term investment. They would need more staff and pilots due to the increase of flights and planes so this will increase costs which will take a chunk out of Cathay’s profit. This new rule will also lead to an increase in competition with airlines such as Air New Zealand and Emirates. The ways Cathay will react to this new law is to lower price and cut as much costs as they are able too. They got fire ground stuff because they are not that important and Cathay would not face loss without them. Cathay will try to increase advertisement and brand awareness such as hosting the Rugby 7s. They would also try to advertise their new routes so they will be able to raise brand awareness. Overall this new law might go two ways good or bad for Cathay as long as they are able to capture their market they will do just fine. Since there will be more flights there will be more sales so I feel Cathay will be able to break even with their costs and everything. Scenario 2......

Words: 397 - Pages: 2

Hong Kong Dragonair Case a

...Hong Kong Dragon Airlines Case A In this case, Hong Kong Dragon Airlines was trying to figure out the appropriate discount rate in order to determine whether purchase or lease an engine for replacing the spare one. Since Dragon Airlines was acquired by another main Hong Kong airline company ‘Cathay Pacific’, we shall use the data of Cathay pacific to find out the weighted average cost of capital. Unfortunately, Cathay Pacific does not issue any bonds that there is no bond or credit rating to assist us calculate the cost of debt. I chose to use the credit rating of Singapore Airlines as an alternative, because according to Hoover’, they have very similar size, revenue and net profit margin with Cathay Pacific. They are also main competitors to each other. The credit rating of Singapore Airline from 2003 to 2004 is not provided. Instead the credit rating is provided in the period of 2011-2012. According to their annual report of 2011-2012, roughly 80% of their financial assets are rated with grades of A to Aaa and 0% of them are rated at Baa. Therefore their credit rate is approximately Aa, in which this case, the bond yield spread over treasuries is 0.9%, the risk-free rate is 0.43% and the risk premium is 0.43%. By calculation, the cost of debt is 0.7% and cost of equity is 0.89% by using CAPM approach. After a brief discussion with Joseph Mann, the total equity is $32989 which equals the sum of share capital, reserves, and minority interest. Total debt is $22631......

Words: 364 - Pages: 2


... Delta Airlines, USA 3rd. Emirates Airlines, UEA Module 1- Lesson 1 General Airline Knowledge Professional Diploma in Aviation & Hospitality Program Instructor: Mary TOH 11/22/2013 1 11/22/2013 2 Cathay Pacific Airways (CX) Founded: World War 2 Pilots: Aircraft: Headquarters: Subsidiaries: About Cathay Pacific 11/22/2013 24 September 1946 Royal Farrell (American) & Sydney de Kantzow (Australian) DC3 – Betsy and Niki Hong Kong. Dragonair & Air Hong Kong (Cathay Pacific & DHL joint venture partners) 4 3 11/22/2013 Parent Company: Swire Pacific Alliance: Frequent flyer program: Fleet Size: Destinations: Oneworld The Marco Polo Club 133 including cargo 112 including cargo Airport Lounge 1. The Arrival 2. The Pier 3. The Wing 4. The Cabin 5. G16 Lounge 11/22/2013 5 11/22/2013 6 M1 _ Lesson 1 1 The Marco Polo Club The Marco Polo Club is an exclusive loyalty program that offers a range of privileges to their most frequent flyers. There are 4 tiers:1. Diamond 2. Gold 3. Silver 4. Green 11/22/2013 CX Slogan People They Make an Airline m/watch?v=lz1RfUTC 7mI 7 11/22/2013 8 Members of oneworld Alliance: 1. 2. 3. 4. 5. Cathay Pacific, HKG American Airlines, USA British Airways, UK Finnair, Finland Iberia, Spain 9. Qantas, Australia 10. Royal Jordanian Airlines, Jordan 11. S7 Airlines, Russia 12. Air Berlin, Germany 13. Malaysian......

Words: 1112 - Pages: 5

Final Project

...Competitive Advantage for Cathay Pacific | |Background | | | |Cathay Pacific Airways announced 2014 annual results in March 2015, the company stated that the business outlook for 2015 looked to be improved when| |compared to the previous year. However, a number of factors had a significant negative impact on their business. | | | |The principal adverse factors were reduced passenger yield, the continued high fuel price and the increased competition on Hong Kong routes and | |within the region have led to price wars in a climate of economic uncertainty. The Hong Kong-based airline faces a potentially more daunting | |challenge: budget carriers. | | | |In response to the situation, Cathay Pacific......

Words: 673 - Pages: 3


...Cathay Pacific Airways Introduction Cathay Pacific Airways was founded in 1946. It is an airline from Hong Kong. It takes passenger and cargo to over 120 cities world-wide. Its main base is at Hong Kong International Airport. In addition to the fleet of aircraft, these investments include catering, aircraft maintenance and ground handling companies, as well as the corporate headquarters at Hong Kong International Airport. Cathay Pacific and its subsidiaries and associates employ over 20,000 staff in Hong Kong. The airline's two major shareholders are both Hong Kong companies listed on the Hong Kong Stock Exchange, as is Cathay Pacific itself. Cathay Pacific is the major shareholder in AHK Air Hong Kong Limited, an all cargo carrier that offers scheduled services in the Asia region, and is a shareholder in Hong Kong Dragon Airlines Limited. Cathay Pacific is one of the six airlines in the world to get a five star rating from Skytrax. It won "Airline of the Year" award from Skytrax in 2003, 2005 and 2009. Its sister airline is Dragonair which serves destinations in mainland China and Asia, the member of the oneworld global alliance whose combined network serves over 700 destinations worldwide. Anticipated problem/limitation We can found many information, data, literature in the internet and library, but it had many things that didn’t need. We need to look thought those information, then classify it and choose what we need. Also, there had many literatures in the......

Words: 423 - Pages: 2

Lost Malaysia. With a fleet of only one aircraft, Dragonair was known in its early days as the “when-it’s-in-the-air-there’s-nothing-on-the-ground” airline. After much effort by Chao to rally support from both the Chinese central government and the British government, Dragonair began service to Phuket and six cities in mainland China in 1986. In 1990, CITIC Pacific, the Swire Group 5 and Cathay Pacific Airways (“Cathay Pacific”) acquired an 89% stake in Dragonair. After the acquisition, Cathay Pacific transferred its 1 In the aviation industry, a piece of equipment was usually deemed BER when the cost of repair exceeded 70–80% of the new equipment cost. 2 Wikipedia (2008) “Hong Kong Dragon Airlines Company Ltd.”, (accessed June 2008). 3 Dragonair (2008) “About Dragonair”, (accessed June 2008). 4 Wharton Hong Kong (2007) “Biography of K.P. Chao”, (accessed June 2008). 5 The Swire Group was also the largest shareholder of Cathay Pacific Airways. Andrew Lee prepared this case based on published sources and interviews with industry observers under the supervision of Professor Su-Han Chan and Professor Ko Wang for class discussion. This case is not intended to show effective or ineffective handling of decision or business processes. Timing, figures and values presented in the case are estimates only and are......

Words: 2116 - Pages: 9

Cathay Pacific

...Cathay Pacific [Case Analysis] Due to substantial deregulation of the airline industry in the 1980s, a highly competitive environment arose for airline carriers. Cathay Pacific, for one, was particularly efficient in making the most of this new environment, and this is largely attributable to how the airline has managed its IT operations. By outsourcing (mainly non-strategic) functions that were not core competencies, for example, they did not only cut down on costs but they also effectively reduced risks. So as the airline continued to grow, it rigorously transitioned from “strictly building and operating to acquiring and managing.” Facilitated by its global linkages, Cathay Pacific now found itself in a better position to identify key suppliers and infrastructure. This new stance allowed the airline to narrow searches down to optimal combinations of suppliers that remained competitive. Although this would later become a hindrance, as newfound partners would hold “partner” statuses that made it difficult for the airline to issue standard requests for pricing, it had an overall significant effect that put the company in a stronger position to compete. Cathay, did however, eventually replace the “smart-sourcing” strategy around 2004, when the new theme of corporate purchasing process was competition. smartsourcing: Under this new strategy, the airline focused on using fewer and longer-term suppliers that consistently demonstrated flexibility and......

Words: 285 - Pages: 2

Cp Green Project just give money to Cathay. So we the project must give a clear transparency to state the use of all income. 8. The positive effective to environment. This criterion is about the effect to the environment protection. This is related with Cathy’s Green image. If the project can give good environment protection will give a better Green image to Cathay. 9. Has low risk in meeting scope, time, and cost goals. As to manage a project, the efficiency is very important. We need to assume the project can finish on time and use less resource. In project management, we need to define the needs to implement a project. Then support the resources. So, in this part, we will define the details of these projects for chosen. Project 1 Use the commercial food scrap generators to transform the food waste into compost. The compost can then be given to the local roof-top farmers and other green bodies to replace their expensive imported soil from Germany. 1. As for compost, we need a place to let the food waste change to compost. And this place must give 1000 square meters capacity to put the food waste. 2. The transport costs for transfer the food waste to the place to compost. 3. We need to find the customer to get the compost; we think the compost should sell as a cost price to the customers like local farmer. Then they don’t need to buy the expensive imported soil from Germany. This would be a serious point, since we want to create a green image for Cathay Pacific. So we can’t......

Words: 2251 - Pages: 10

New Business Strategy

...According to the internal and external analysis and we found out there are some room for Cathay Pacific for compete more aggressively if it wishes to develop its business in the Asia region. Cathay Pacific already has had a good network within South East Asia and serves most major cities from Hong Kong with reasonable frequency. Currently most of those passengers who fly to Hong Kong on Cathay flights terminate their journey at that destination (with the possible exception of Taiwan). With Cathay already having a impressive long-haul network in place a smaller number of passengers are choosing to use Hong Kong as a ‘stopover’ in order to fly on to another destination. This is an area that Cathay Pacific can exploit. Whilst the Cathay serves most major cities with good frequencies and therefore covers a large geographical segment within Asia there is one area which Cathay is not well represented, China. Because of this Cathay looses out in three ways: o Loss in potential revenue from Chinese nationals wishing to visit Hong Kong and vice versa; and o Loss in potential revenue from Chinese nationals wishing to fly to Europe, the USA or Australia and potentially using Hong Kong as a ‘stop-over’ o Loss in potential revenue from international travellers coming from outside Asia who wish to visit China potentially using Hong Kong as a ‘stop-over’. As can be seen from the analysis Cathay Pacific Airways has a well respected brand and is a well run company that is......

Words: 509 - Pages: 3

Cathay Pacific Investment Plan

...first six months of 2011, the figure reflected declining number in both cargo and passengers carrier for Cathay Pacific and China Southern Airways, accompany with the high jet fuel prices, the future in airlines industry is pessimistic.According to Wallis (2012), China Southern Airlines claimed there is 50% drop in net profit compare to last year, contributed by high jet fuel costs, losses in exchange rate (6.3760 against the dollar) and China’s slowing down economy due to Europe’s austerity measures and government debt burdens. On the other hand, its major rival Cathay Pacific announced billions dollars investment on more fuel efficient and nautical miles aircrafts airbus A350-1000. With better fuel efficiency aircraft and well-tailored flight patterns, Wallis (2012) believes it shall remain its competitive position in the industry.IATA (2012) believes that both the air travel and freight volumes are likely to show slow growth in the coming period due to deepening economic recession and consumer confident. Although the fuel price has a significant drop in second quarter, will not compromised with weak demand and passenger load factors.3(e). Comment on the relative strengths and weaknesses of your entire analysis. Specifically referring to the companies analyzed in your report, your discussion should focus on what your analysis have accomplished and what are the limitations. Cathay Pacific Airways Limited offered scheduled passenger and cargo service to over 140 destinations......

Words: 832 - Pages: 4

Spark (1) | driver booster 6 ser | 8 Bandes adhésives réfléchissantes pour signalisation sur casque 8x2 cm