Cathay Pacific invests over HK$100 billion to strengthen Hong Kong's position as an international aviation hub
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Civil Aviation Resources Network, August 7, 2024: Cathay Pacific Group (Cathay Pacific) will invest more than HK$100 billion in the next seven years to support its active development strategy, further enhance customer experience, and consolidate Hong Kong's position as an international aviation hub in conjunction with the completion of the airport's three-runway system. This major investment includes fleet, cabin products, VIP lounges, digital upgrades and sustainable development, and is committed to moving forward for customers, employees and our home - Hong Kong.
Cathay Pacific Group Chairman John Hooper said: "The upcoming completion of the three-runway system will drive Hong Kong's aviation industry into a new era. The next few years will be full of new development opportunities. It is an exciting time for both Hong Kong and Cathay Pacific.
"As an airline rooted in Hong Kong, Cathay Pacific has been working hard for the successful development of Hong Kong's international aviation hub. This major investment further demonstrates our firm commitment to actively promoting Hong Kong's economic development.
"Our investment in our fleet, cabin products, airport lounges and more will exceed HK$100 billion, reflecting our new chapter and focus on future quality development. Cathay Pacific has entered a new era and the team is determined to move forward and become one of the world's most outstanding service brands."
Ready to fly
Cathay Pacific's investment includes today's announcement of an order for 30 Airbus A330-900 aircraft, with an option to purchase an additional 30 aircraft. This regional wide-body aircraft is expected to be delivered in batches from 2028 and will join Cathay Pacific's fleet to mainly serve Asian routes.
Including the latest order, Cathay Pacific will receive more than 100 new-generation aircraft in the future, and has the option to purchase more than 80 additional aircraft, involving different types of aircraft, including narrow-body aircraft, regional wide-body aircraft, long-haul wide-body aircraft and large freighters. This major investment will further modernize and expand Cathay Pacific's fleet to a higher level of strength. As the new aircraft are more fuel-efficient and can reduce carbon emissions, it will also help the group achieve its goal of net zero carbon emissions by 2050.
As the premium airline of the Group, Cathay Pacific also plans to launch a number of new cabin products in the next three years to provide customers with a superior flying experience. This year, we will first introduce a new business class - AriaSuite, Premium Economy Class, and a refreshed Economy Class on the redesigned Boeing 777-300ER aircraft. With the first Boeing 777-9 aircraft joining the fleet in 2025, we will also provide customers with a world-leading new First Class cabin experience next year. In 2026, we will also introduce a new Business Class product with a flat bed on the existing Airbus A330 aircraft.
In addition, free in-flight Wi-Fi service for Business Class customers and Diamond card members will be launched in the coming months. We will also continue to increase investment in catering and in-flight entertainment to provide customers with a more satisfying and high-quality experience.
In terms of ground services, Cathay Pacific will launch newly designed flagship lounges in Hong Kong and Beijing in the next three years, and open the first Cathay Pacific exclusive lounge at New York's JFK International Airport.
The road to reconstruction is steady and solid
Cathay Pacific announced its investment plan today and released the group's 2024 interim results at the same time. Cathay Pacific Group recorded an attributable profit of HK$3.6 billion in the first half of 2024, compared with an attributable profit of HK$4.3 billion in the first half of 2023.
Excluding special items, the airlines and subsidiaries of the Cathay Pacific Group recorded an attributable profit of HK$3.8 billion in the first half of 2024, compared with an attributable profit of HK$4.8 billion in the first half of 2023. The year-on-year decrease was mainly due to the normalization of airfares. At the same time, the results from affiliated companies (most of which were recognized three months later) recorded a loss of HK$342 million, compared with a loss of HK$2.6 billion in the first half of 2023.
18 months since the start of its reconstruction, Cathay Pacific has fully repaid the HK$19.5 billion investment to the Hong Kong Special Administrative Region Government and paid a dividend of HK$2.44 billion during the period when the SAR Government held the preferred shares. At the same time, Cathay Pacific also announced the first interim dividend to ordinary shareholders, totaling approximately HK$1.3 billion. The Group has previously paid a dividend of HK$2.8 billion to ordinary shareholders for 2023.
These encouraging results are sufficient to prove that Cathay Pacific Group has achieved significant results in its reconstruction. All of the Group's aircraft that were previously parked overseas for a long time have returned to the fleet, and the number of passenger flights of the Group will return to 100% of the pre-epidemic level in the first quarter of 2025 as expected. In order to support business development, the number of employees of the Group will have a net increase of 5,000 this year to 29,000.
Cathay Pacific is committed to building Hong Kong into an international aviation hub, connecting customers to various colorful cities around the world. Currently, the Group's two airlines (including Cathay Pacific and Hong Kong Express) fly passenger flights to more than 80 destinations around the world, and the number of destinations is expected to increase to 100 by 2025. So far this year, the Group has announced 10 new destinations, 8 of which have already started flights, while Riyadh and Cairns routes will be put into service later this year.
Cathay Pacific has always been committed to providing excellent customer experience as the cornerstone of its brand. This year, it was selected as one of the top five best airlines in the world by a well-known industry rating organization and won the "World's Best Economy Class" award.
Cathay Pacific is full of confidence in the prospects of Hong Kong and has always regarded it as its mission to contribute to the prosperity of Hong Kong's international aviation hub. Cathay Pacific adheres to the brand concept of "Aiming for Leap Forward" and aims to become an airline that employees, customers, shareholders and all sectors of society are proud of.