Cathay Pacific to post narrower-than-expected 2021 annual loss

[SYDNEY] Hong Kong's Cathay Pacific Airways said on Monday that it expected to post a narrower-than-expected HK$5.6 billion (S$967.4 million) to HK$6.1 billion annual loss for 2021 but that cash burn was rising because of stricter quarantine measures.

The forecast loss compared with the average HK$10.2 billion estimate from 12 analysts polled by Refinitiv, and the airline's larger 2020 loss of HK$21.65 billion, which included aircraft impairments and restructuring charges.

Cathay, which posted a HK$7.57 billion loss in the first half of 2021, said it had generated some positive cashflow in the second half amid strong cargo demand.

However, it forecast it would burn through HK$1 billion to HK$1.5 billion of cash a month starting in February after the government tightened crew quarantine restrictions, forcing the airline to cut cargo and passenger capacity sharply.

Cathay is operating about 2 per cent of its pre-pandemic passenger capacity and about 20 per cent of its pre-pandemic cargo capacity in January.

"Until conditions improve, we are doing everything in our power to maximise capacity, and estimate that mitigation measures to increase crew resources will enable us to operate approximately an additional 5 per cent more cargo flight capacity than we are currently operating," Cathay chief executive Augustus Tang said in a statement.

REUTERS