Cathay Pacific predicts substantial loss due to ‘unprecedented’ coronavirus hit
Hong Kong’s flag carrier Cathay Pacific has said that the “unprecedented challenge” of coronavirus will see it suffer a substantial loss this year after the outbreak forced it to ground over half its fleet.
The airline has been one of the carriers which has been worst affected by the outbreak, which came on the back of a 28 per cent plunge in earnings in the second half of last year due to ongoing anti-government protests.
Cathay has grounded 140 of its planes due to the outbreak, and has warned that it is expecting capacity to fall by 65 per cent in March and April, up from the 40 per cent previously predicted.
Earlier this month it announced that it had carried 82 per cent fewer passengers in February due to the virus’ impact.
Chairman Patrick Healy said: “Cathay Pacific has been through challenging times before, but the scale that we are facing in the current situation really is an unprecedented challenge.
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“We have no idea when a recovery will take place and we don’t know exactly what it would look like,” he added. “All we know is we remain in a very dynamic situation”.
The airline added that it was in discussions with both Airbus and Boeing about delaying the delivery of new aircraft orders in a bid to mitigate the financial impact of the virus.
In the meantime, Cathay confirmed that it was still receiving planes. The airline is due to receive 17 A350 and A320s from Airbus this year.
It would also not rule out making job cuts, with 80 per cent of employees already agreeing to three weeks of unpaid leave as a cost saving measure.
Finance chief Martin Murray sought to reassure investors, pointing to its $2.6bn in cash, but refused to rule out seeking new funds if the situation continued to deteriorate.