Cathay Pacific posts first loss since 2008 amid rising competition

Singapore

CATHAY Pacific Airways Ltd reported its first loss in eight years and scrapped plans for a second-half dividend after competition from Chinese airlines and losses from fuel hedging dented earnings.

The net loss totalled HK$575 million (S$105 million) in 2016, while sales dropped 9.4 per cent to HK$92.8 billion, Hong Kong-based Cathay, Asia's largest international airline, said in a statement on Wednesday. Jefferies Group LLC said the losses could continue in the current year as well.

Cathay said the operating environment in 2017 would remain challenging, and that premium travel from Hong Kong was below expectations, prompting the airline to sell such tickets at promotional prices to leisure travellers. The carrier, whose passenger yields have been damped by competition from full-service carriers for business seats and budget airlines for the mass market, said it is starting a three-year "corporate transformation" programme to improve returns and operational efficie…