This article from NYTimes.com has been sent to you by psa188@xxxxxxxxx /-------------------- advertisement -----------------------\ Explore more of Starbucks at Starbucks.com. http://www.starbucks.com/default.asp?ci=1015 \----------------------------------------------------------/ Cathay Pacific Airways Posts Record Loss August 6, 2003 By THE ASSOCIATED PRESS Filed at 8:43 a.m. ET HONG KONG (AP) -- Cathay Pacific Airways said Wednesday it lost more in the first half of the year than it has for any previous six-month period as the SARS crisis devastated air travel -- and it stopped short of predicting a major turnaround despite a gradual recovery. ``This was without a doubt the most challenging period in Cathay Pacific's history,'' company chairman James Hughes-Hallett said in a statement. ``The outbreak of SARS had a devastating impact on passenger numbers in the second quarter.'' Cathay Pacific lost a company-record 1.241 billion Hong Kong dollars ($159 million) in the six months ending June 30, compared with a profit of 1.412 billion Hong Kong dollars during the same period in 2002, a company statement said. Its previous record half-year loss was in the six months ending December 2001, when the company lost 662 million Hong Kong dollars due to reduced air travel following the Sept. 11 terror attacks. The latest results were smaller than the loss of 1.46 billion Hong Kong dollars ($187 million) forecast by analysts in a survey by Dow Jones Newswires. Industry observers expect the company to rebound by the end of this year or the first quarter of 2004. Revenue plunged almost 21 percent to 12.275 billion Hong Kong dollars ($1.57 billion), from 15.511 billion Hong Kong dollars in the same period last year. The territory's tourism industry was devastated when the World Health Organization imposed a travel warning between April 2 and May 23 on Hong Kong during the outbreak of severe acute respiratory syndrome. Cathay Pacific said it was losing $3 million a day during the crisis as passenger traffic in the first half shrank by one-third to 4.02 million. SARS, which killed 299 here and more than 800 worldwide, originated last year in mainland China and was spread by air travelers. Hughes-Hallett said flights to Taiwan and North America were hardest hit, but Cathay said it expects flights, which is flying 90 percent of its full schedule, will return to normal levels by the end of September. The company will add new flights to London and the Australian cities of Oakland and Melbourne next month. ``As demand continues to recover, we anticipate a much improved performance in the second half year,'' he said. Hughes-Hallett declined to give a full-year forecast at a news conference but warned uncertainties remain. ``We're assuming we will recover some of the losses. We hope to recover all of them, but that is a hope rather than a forecast,'' he said. He said the carrier is operating now around break-even and is expected to maintain the momentum of current recovery. Cathay carried 459,627 people in June, compared with 243,976 in May. However, he said Cathay struggles from low profit margins due to discounted fares and promotional packages. Analysts also predicted a rebound but said Cathay probably still faces a loss for the full year. ``The results were much better than the market expectations, and that means it could recover very well in the second half of the year,'' said Francis Lun, general manager of Hong Kong's Fulbright Securities. ``But I don't think it can recover all its losses until early next year.'' Lun predicted Cathay will lose between 300 million Hong Kong dollars ($38 million) and 400 million Hong Kong dollars ($51 million) for the full fiscal year. Cathay' shares ended 0.5 percent lower on Wednesday. http://www.nytimes.com/aponline/business/AP-Earns-Cathay-Pacific.html?ex=1061176453&ei=1&en=3e0fac5fbc409b91 --------------------------------- Get Home Delivery of The New York Times Newspaper. Imagine reading The New York Times any time & anywhere you like! Leisurely catch up on events & expand your horizons. Enjoy now for 50% off Home Delivery! Click here: http://www.nytimes.com/ads/nytcirc/index.html HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@xxxxxxxxxxx or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@xxxxxxxxxxxx Copyright 2003 The New York Times Company