Hong Kong Airlines Cathay Pacific said on Wednesday it incurred a record $ 2.8 billion loss last year as the coronavirus pandemic wiped out travel demand. – The airline has warned of a long road to recovery in the future.
Chairman Patrick Healy described the year 2020 as the “most challenging” in the company’s 70-year history, and said that much will now depend on the effectiveness and prevalence of global vaccination programs.
He warned that “it is not clear in any way how the epidemic and its impact will develop in the coming months,” saying that the group expects passenger traffic to remain “well below” half of pre-epidemic levels throughout 2021.
The company’s losses were higher than estimates compiled by Bloomberg News.
Cathy incurred a loss attributable to HK $ 21.6 billion for 2020, and it went deeper into the red as the year progressed.
Its second-half losses were 11.8 billion HK dollars, up from 9.9 billion HK dollars in the first six months of the year when the epidemic first emerged.
Like all major airlines, Cathay Pacific has seen its business evaporate during the coronavirus pandemic, but the Hong Kong carrier has had a particularly difficult year because it has no domestic market to return to.
The epidemic is already in a vulnerable position.
When the coronavirus first surfaced, Hong Kong plunged into a recession, and Cathay Pacific fell into the red as months of massive and devastating democratic protests in 2019 led to a drop in customers, especially from the lucrative Chinese market on the mainland.
The company also found itself sanctioned by the authorities in Beijing because some of its employees had joined or expressed support for the protests.
As the pandemic spreads, the airline has set off on a cost-cutting spree, shutting down its Cathay Dragon branch and leasing nearly 8,500 surpluses.
With the help of the government bailout, it underwent a recapitalization process in July, which raised 39 billion Hong Kong dollars.
But passenger numbers have been about 98% below pre-pandemic levels since April, and for most of last year the company has been burning cash at a rate of as much as 1.5 billion Hong Kong dollars a month.