Cathay Pacific's first half disappoints - commits to future of higher costs

Cathay Pacific's interim result does not make for encouraging reading. Cathay's recent hairy-chested growth strategy has come at a big cost, with capacity expansion and reduced hedging benefits leading to a destruction of earnings. Operating profit margin slumped into negative territory in the first half of 2008, compared to a 9.2% margin in 1H07 and a double-digit margin in the full year of 2007.