Swire: Cathay Pacific results 'adversely affected' by competition, high fuel costs, hedging

Swire Pacific issued (09-Nov-2017) a profit warning, covering numerous division, including Cathay Pacific. Swire stated: "Cathay Pacific does not expect the operating environment in the second half of 2017 to improve materially. In particular, the passenger business will continue to be affected by strong competition from other airlines and the group's results are expected to be adversely affected by higher fuel prices and Cathay Pacific's fuel hedging positions. However, the outlook for the cargo business is good and robust demand and growth in cargo capacity, yield and load factor are expected in the second half of the year. The benefits of the transformation are expected to start to be seen in the second half of 2017 and the effects will accelerate in 2018". Swire also noted that demand for HAECO's line services in Hong Kong is expected to be stable in 2H2017 while noting that demand for airframe services is "expected to fall for normal seasonal reasons and because of deferral of work by some customers". Swire added: "Demand for airframe services at HAECO Americas and HAECO Xiamen is expected to decrease. TEXL's engine overhaul businesses is expected to be stable. HAESL's results are expected to be weaker". [more - original PR]