Cathay Pacific flags 1H profit of HK$6.5B, nearly doubling on travel demand

Cathay Pacific Airways forecast first-half profit of as much as HK$6.5 billion, nearly double last year's, on surging travel and cargo demand.

"Cathay Pacific's strong operating performance across both passenger and cargo segments drove the earnings improvement," the company said in a filing.

The airline carried 12% more passengers in June from a year earlier, with available seat kilometers rising 6%. For the first six months, passenger traffic increased 17%. Cargo tonnage rose 9% in both June and the first half, while available freight tonne kilometers edged up 1% in June.

The profit includes a HK$1.4 billion one-time gain from the dilution of Cathay's stake in Air China. The results show the carrier's recovery as Hong Kong's aviation hub continues to benefit from strong regional travel demand.

The airline group also cited improved performance from its low-cost unit HK Express and higher contributions from associates as factors behind the profit jump. The HK$6 billion to HK$6.5 billion range compares with about HK$3.7 billion in the same period last year.

Cathay has been rebuilding its network after the pandemic, adding flights across Asia, North America and Europe. The carrier's cargo division has also benefited from sustained e-commerce demand out of China, which has kept freight rates elevated even as passenger belly capacity returns.

The guidance raise shows Cathay Pacific's earnings momentum is accelerating as travel demand normalizes across Asia. Investors will watch the interim results release for updated capacity plans and dividend policy.

This article is for informational purposes only and does not constitute investment advice.