2022 revenue figures disappoint for Cathay Pacific Cargo

Source: Cathay Pacific Cargo

Last year, Cathay Pacific experienced a decline in cargo revenues by double-digit percentage levels due to the impact of Covid restrictions on its operations. In 2022, the airline reported a 16.6% decrease in cargo revenues to HK$26.9bn, while cargo revenue tonne kms (CRTK) fell 29.8% YoY to 5.7bn, and capacity decreased by 19% to HK$8.2bn. As a result, the cargo load factor declined by 10.8 percentage points to 70.6%. However, yield increased by 18.5% to HK$4.67.

During the first half of the year, the carrier had to significantly reduce its freighter operations due to Covid lockdown and quarantine restrictions, which began to ease on May 1. CEO Ronald Lam stated that “Our travel and cargo operations in 2022 were constrained by travel restrictions and quarantine requirements for both travellers and Hong Kong-based aircrew that were in place in Hong Kong until the Hong Kong SAR Government began introducing progressive adjustments from 1st May onwards." These adjustments enabled the company to gradually resume more flights, especially between October and December.

By August, the carrier had resumed operating a full freighter schedule, and as they added more passenger flights, the additional belly capacity provided by the passenger aircraft allowed them to offer more options to their cargo customers. The group was operating around two-thirds of pre-pandemic cargo flight capacity levels by the end of the year, and the company aims to have cargo capacity back up to 85% of pre-pandemic levels by the end of this year.

In terms of the future, the carrier highlighted the expansion of Hong Kong International Airport with a third runway and its continued efforts to build links with the Greater Bay Area (GBA). Lam said, “Cathay Pacific Cargo and Cathay Pacific Services Limited became the first carrier and cargo terminal operator, respectively, to have cargo shipments accepted in Dongguan Logistics Park [in the GBA] and transported to HKIA by ship for outbound airfreight in February 2023. This also involved establishing our own upstream bonded facility – the Cathay Cargo Terminal Dongguan – located at the Bestar Logistics Centre in Dongguan.”

Despite the challenging circumstances, the airline swung to an operating profit of HK$3.5bn in 2022, as revenues surged 12% to HK$51bn. Net losses widened to HK$6.5bn, mainly due to weakness at associates during 2022. However, the second half of the year was significantly better than the first half.