Hong Kong carrier Cathay Pacific on Wednesday reported that losses had eased in the first half after an “extremely difficult start” to the year, but said its capacity will improve in the coming months as travel sentiment improves.
The loss of $637 million for January-June narrowed the deficit of $968 million for the same period last year as the airline benefited from strong cargo demand and cost-cutting measures.
Chairman Patrick Healey said in a statement that the first few months have been “particularly unfavorable” as pandemic-related travel restrictions severely curtailed Cathay’s flight operations and severely impacted travel demand.
But he added that the airline is preparing for the reopening of borders and expects a stronger second half.
Cathay aims to increase passenger flight capacity to a quarter of pre-pandemic levels by the end of 2022, while increasing cargo capacity to 65 percent, Healey said.
The airline carried 335,000 passengers in the first half of the year, more than double the same period in 2021, and generated revenue of $263 million.
Total revenue increased 17 percent year over year to $2.4 billion.
Hong Kong has taken tentative steps to reopen its borders after two and a half years of international isolation due to strict Covid rules for travellers.
On Monday, authorities said visitors would now have to spend just three days in hotel quarantine, down from seven and much fewer than the three weeks earlier in the year.
Cathay hailed the adjustments as “positive steps” but urged the government to “urgently provide a clear roadmap” to lift all pandemic-related restrictions on passengers and aircraft crew.
The company’s ability to operate more flights “remains severely constrained by a shortage of crew resources under existing quarantine requirements,” Healey said Wednesday.
Last month, Hong Kong also suspended a safeguard mechanism that penalizes airlines for bringing in coronavirus cases – which had affected numerous Cathay routes, including for key markets like the United States and Britain.
The airline served just 29 destinations in January, down from more than 100 before the pandemic.
Hong Kong authorities are pointing to a possible international reopening in November, coinciding with the high-profile Rugby Sevens tournament and a banking summit.
Cathay is bringing planes parked overseas back to Hong Kong and aims to hire more than 4,000 frontline workers over the next 18 to 24 months, Healey said.
In June, Hong Kong also extended the drawdown period on a $1 billion bridge loan to Cathay – for the second time in two years – as part of a $5 billion government bailout to help the airline deal with the pandemic help.
Hong Kong’s home carrier suffered a shattered reputation earlier this year when a coronavirus outbreak was traced to two of its flight attendants who flouted their quarantine rules. They were released and later charged.
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