Investment Rating - Buy (首次评级) [3][6] Core Views - Cathay Pacific is a global airline with a strong presence in Hong Kong and the Greater Bay Area, operating both passenger and cargo services globally [3] - The company is expected to benefit from the recovery of international air travel, particularly from transit passengers from mainland China [5] - Cathay Pacific is well-positioned to capitalize on the long-term structural changes in the aviation industry, including the reopening of polar routes and the competitive advantage in long-haul routes [5] - The company is entering a new phase of growth starting in 2025, driven by the normalization of travel demand and the expansion of Hong Kong International Airport's third runway system [5] Business Overview Passenger Business - Cathay Pacific's passenger business has shown strong recovery post-pandemic, with passenger volume rebounding significantly in 2023 and continuing to grow in 2024 [4] - The company's passenger load factor and revenue per passenger kilometer (RPK) have improved, although ticket prices are expected to decline slightly as capacity increases [4] - Cathay Pacific is expected to maintain high ticket prices due to the supply-demand imbalance, with passenger demand still being released gradually [4] Cargo Business - Cathay Pacific is a leading player in the global air cargo market, with significant capacity deployed in Northeast Asia and North America [3] - The company's cargo business has remained strong, with cargo yields staying above pre-pandemic levels [4] - The company is expected to continue increasing cargo capacity, leveraging Hong Kong's position as a global air cargo hub [4] Financial Performance and Valuation - Cathay Pacific's net profit is expected to decline to HKD 7.133 billion in 2024 but rebound to HKD 9.008 billion and HKD 10.82 billion in 2025 and 2026, respectively [6] - The company's ROE is projected to reach 10.9%, 12.6%, and 13.7% in 2024, 2025, and 2026, respectively [6] - Based on the PB-ROE valuation model, the target PB ratio for 2025 is 1.1-1.2x, implying a valuation range of HKD 78.7-85.8 billion, representing an upside potential of 37-50% [6] Strategic Advantages - Cathay Pacific benefits from its dominant position in Hong Kong's aviation market, with a market share of over 55% [102] - The company is expected to gain from the expansion of Hong Kong International Airport's third runway system, which will significantly increase capacity and open up new growth opportunities [104] - Cathay Pacific's extensive global network and focus on international routes position it well to benefit from the recovery of long-haul travel and the competitive advantages in the post-pandemic aviation landscape [5] Industry Outlook - The global aviation industry is expected to see a recovery in passenger demand, particularly in international travel, with Cathay Pacific well-positioned to benefit from this trend [5] - The air cargo market remains strong, with global demand for air freight continuing to grow, providing further growth opportunities for Cathay Pacific [132] - The long-term growth of the Greater Bay Area and the expansion of infrastructure in the region will further support Cathay Pacific's growth, particularly in the cargo segment [112]

Financial Performance - For the six months ended June 30, 2024, the group reported revenue of HKD 49,604 million, an increase of 13.8% compared to HKD 43,593 million in the same period of 2023[6]. - The attributable profit to shareholders of Cathay Pacific Group was HKD 3,613 million, a decrease of 15.3% from HKD 4,268 million in the previous year[6]. - Basic earnings per share decreased by 14.8% to HKD 52.4 cents from HKD 61.5 cents[6]. - Total revenue for Cathay Pacific increased by 14.0% to HKD 44.784 billion in the first half of 2024, up from HKD 39.273 billion in the previous year[40]. - Passenger service revenue rose by 20.0% to HKD 30.017 billion, with available seat kilometers increasing by 42.7%[40]. - Cargo service revenue increased by 1.5% to HKD 10.902 billion, with available cargo ton kilometers rising by 11.4%[40]. - Operating expenses for the group increased by 17.6% to HKD 45.152 billion, compared to HKD 38.403 billion in the first half of 2023[41]. - The operating profit before non-recurring items was HKD 5,907 million, down 11.0% from HKD 6,636 million in 2023[50]. - The net profit for the period was HKD 3,613 million, a decrease of 15.4% from HKD 4,268 million in the previous year[52]. Operational Metrics - The group had available unrestricted cash of HKD 25,416 million, up 27.2% from HKD 19,985 million[6]. - The debt-to-equity ratio improved to 0.78 from 0.88, a decrease of 0.10 times[6]. - The group operated a fleet of 231 aircraft, with 73 new aircraft expected to join in the coming years[4]. - Available tonne-kilometers increased by 22.8% to 11,822 million compared to 9,628 million in the previous year[7]. - Available seat-kilometers rose by 42.7% to 52,881 million from 37,053 million year-on-year[7]. - Revenue passenger kilometers grew by 34.9% to 43,583 million, up from 32,308 million[7]. - Passenger load factor decreased by 4.8 percentage points to 82.4% from 87.2%[7]. - Average aircraft utilization increased by 34.3% to 9.0 hours per day from 6.7 hours[7]. Fleet and Capacity Expansion - The average age of the fleet increased by 0.5 years to 11.5 years compared to 11.0 years last year[7]. - The group plans to replace its Airbus A300-600F freighter fleet with second-hand Airbus A330F freighters by 2025[8]. - The company plans to expand its flight destinations from over 80 to 100 by 2025, having announced 10 new routes this year, with 8 already in service[12]. - The company plans to introduce new seating products over the next three years, including a redesigned business class on the Boeing 777-300ER and new cabins on the Airbus A330 by 2026[12]. Sustainability Initiatives - The group aims to reduce carbon emissions intensity by 12% by 2030 compared to 2019 levels, and has made progress in sustainable aviation fuel initiatives[11]. - The group plans to modernize its fleet with new generation aircraft, including Airbus A321neo, A320neo, Boeing 777-9, and A350F freighters, to support long-term development and achieve net-zero carbon emissions by 2050[11]. - Cathay Pacific aims to achieve net-zero carbon emissions by 2050 and reduce carbon intensity by 12% from 2019 levels by 2030[35]. - The airline plans to reduce single-use plastic per passenger from an average of 7.7 items in 2019 to 1.5 items by 2025[35]. Employee and Recruitment - The group employs over 27,200 staff worldwide, with approximately 22,700 based in Hong Kong[5]. - The group is in a significant recruitment and training phase to meet increasing travel demand, restoring passenger flights to 80% of pre-pandemic levels[9]. - The company will increase its workforce by 5,000 by the end of this year, bringing the total number of employees to 29,000 to support growth[12]. - The "Wellbeing@Cathay" program has been launched to enhance employee mental and physical health, including various health-related activities[37]. Customer Experience and Services - The company is committed to enhancing customer experience with free Wi-Fi services for business class passengers and Cathay Diamond Card members in the coming months[12]. - The company has partnered with Michelin-starred restaurants to enhance in-flight dining experiences, showcasing a range of gourmet meals[18]. - The company is focusing on digitalization and sustainability in its cargo operations, reflecting confidence in Hong Kong as a logistics hub[12]. Financial Management and Investments - The group continues to implement financial risk management policies, including currency, interest rate, and fuel price risk management[47]. - The company has completed the redemption of HKD 9.75 billion in preferred shares and paid HKD 2.4 billion in dividends related to these shares[11]. - The group plans to redeem and cancel all 195,000,000 preferred shares by the end of July 2024, subject to market conditions[85]. - The group issued HKD 18,250 million in non-listed notes under its USD 2.5 billion medium-term note program, compared to no issuance in the previous six months[78]. Market Expansion and Strategic Partnerships - The company is exploring strategic partnerships to enhance its market presence in Asia, particularly in the Greater Bay Area[110]. - The company plans to expand flight services to mainland China, increasing capacity to attract more travelers[17]. - New direct flights to Ningbo will be launched on August 1, 2024, enhancing connectivity in Northeast Asia[17]. Awards and Recognition - Cathay Pacific was awarded "Best Green Cargo Airline of the Year 2024" at the AFLAS Awards in June 2024[22]. - The company received four awards from the Hong Kong Human Resources Management Society, including the Gold Award for Employee Experience[26]. - The company received the "Top 5 Airlines by Absolute Cargo Growth (Global)" award at the Changi Airport Group's 2024 Changi Airline Awards in May[22].

Investment Rating - The investment rating for Cathay Pacific Airways is maintained as "Buy" with a target price adjusted to HKD 11.15 [3][8]. Core Views - The report indicates that while the 1H24 performance was below expectations, the company is still viewed positively in terms of its profit cycle, with expectations for improved profitability and return on equity (ROE) [3][4]. - The company reported a net profit attributable to shareholders of HKD 3.613 billion for 1H24, a year-on-year decrease of 15.3%, while revenue increased by 13.8% to HKD 46.904 billion [3][4]. Summary by Sections Financial Performance - In 1H24, Cathay Pacific's capacity recovery was steady, with ASK/RPK increasing by 42.7%/34.9%, returning to 65%/64% of the levels seen in the same period of 2019 [4]. - The passenger load factor was 82.4%, down 4.8 percentage points year-on-year, while unit revenue per passenger kilometer decreased by 11.0% [4]. - The company recorded passenger revenue of HKD 33.0 billion, a 19.7% increase, and cargo revenue of HKD 12.61 billion, a 1.4% increase [4][5]. Cost Management - Operating costs for 1H24 were HKD 43.7 billion, up 18.2% year-on-year, but unit costs showed a decline due to improved aircraft utilization [5]. - The company achieved an operating profit of HKD 5.91 billion, a decrease of 11.0% year-on-year [5]. Dividend Policy - Cathay Pacific announced an interim dividend of HKD 0.20 per share, reflecting a payout ratio of 38%, indicating a positive outlook on profitability [6]. Future Projections - The report projects net profits for 2024, 2025, and 2026 to be HKD 7.736 billion, HKD 7.929 billion, and HKD 8.112 billion respectively, with corresponding EPS estimates of HKD 1.20, HKD 1.23, and HKD 1.26 [7][11]. - Revenue forecasts for 2024, 2025, and 2026 are set at HKD 105.888 billion, HKD 115.790 billion, and HKD 122.367 billion, reflecting growth rates of 12.07%, 9.35%, and 5.68% respectively [7][11].

Financial Performance - The group's revenue for the six months ended June 30, 2024, was HKD 49,604 million, representing a 13.8% increase from HKD 43,593 million in 2023[3] - The profit attributable to shareholders for the same period was HKD 3,613 million, a decrease of 15.3% compared to HKD 4,268 million in 2023[3] - The basic earnings per share decreased by 14.8% to HKD 0.524 from HKD 0.615 in the previous year[3] - Cathay Pacific recorded a profit of HKD 3.613 billion in the first half of 2024, down from HKD 4.268 billion in the same period of 2023[6] - The group’s airlines and subsidiaries reported a profit of HKD 3.846 billion after excluding special items, down from HKD 4.763 billion in the previous year, primarily due to normalizing ticket prices[6] - The operating profit before tax for Cathay Pacific, excluding special items, was HKD 4,391 million, down 10.2% from HKD 4,890 million[26] - The operating profit for the six months ended June 30, 2024, was HKD 3,372 million, down from HKD 3,959 million in 2023, reflecting a decrease of 14.8%[48] - The net profit attributable to shareholders was HKD 3,613 million, a decrease of 15.4% from HKD 4,268 million in the prior year[41] Revenue Breakdown - Cathay Pacific's passenger revenue increased to HKD 30.17 billion in the first half of 2024, a 20.0% increase compared to the same period in 2023[7] - Passenger service revenue was HKD 33,004 million, up 19.7% from HKD 27,563 million year-on-year[32] - Cargo revenue for Cathay Pacific was HKD 10.92 billion, a 1.5% increase from the previous year, with total cargo tonnage rising by 10.4% to 719,000 tons[7] - Cathay Pacific's cargo service revenue saw a modest increase of 1.5%, reaching HKD 10,902 million, up from HKD 10,741 million[24] Capacity and Operations - The total available tonne-kilometers increased by 22.8% to 11,822 million from 9,628 million in 2023[4] - The available seat kilometers rose by 42.7% to 52,881 million compared to 37,053 million in 2023[4] - The passenger load factor decreased by 4.8 percentage points to 82.4% from 87.2% in the previous year[4] - The passenger flight capacity has been restored to 80% of pre-pandemic levels as of the second quarter of 2024[6] - The total number of passengers carried reached 10.7 million, averaging about 59,000 passengers per day, which is a 36.4% increase year-on-year[7] - In H1 2024, passenger capacity increased by 42.7% to 52,881 million available seat kilometers, with an overall load factor of 82.4%[14] Financial Position - The net debt decreased by 9.1% to HKD 47,971 million from HKD 52,764 million in 2023[2] - The available cash increased by 27.2% to HKD 25,416 million from HKD 19,985 million in 2023[2] - The group's net borrowings decreased by 9.1% to HKD 47,971 million, with a debt-to-equity ratio dropping from 0.69 to 0.61[29] - The total debt as of June 30, 2024, was HKD 66,810 million, a decrease from HKD 68,294 million at the end of 2023[50] - The net debt to equity ratio improved to 0.78 in 2024 from 0.88 in 2023, indicating a stronger balance sheet[50] Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.20 per share, compared to no dividend in the previous year[3] - The group plans to distribute an interim dividend of HKD 0.20 per ordinary share, payable on October 9, 2024[6] - The company reported no dividend arrears for ordinary shareholders as of June 30, 2024[63] Strategic Initiatives - The group is undergoing an unprecedented recruitment and training phase to meet rising travel demand[6] - The company plans to reach pre-pandemic flight levels by Q1 2025, with an increase of 5,000 employees by year-end, totaling 29,000 staff[12] - The passenger flight network will expand from over 80 to 100 destinations by 2025, with 10 new routes announced this year, 8 of which are already operational[12] - Cathay Pacific aims to modernize its fleet with new aircraft, including Airbus A321neo, A320neo, Boeing 777-9, and A350F freighters, to support long-term development and reduce carbon emissions[11] Sustainability Efforts - Cathay Pacific has set a new target to reduce carbon intensity by 12% by 2030 compared to 2019 levels, reflecting its commitment to sustainability[8] - The company plans to offset 10% of its carbon emissions from business travel with sustainable aviation fuel starting in 2024[31] Market and Demand Insights - Cargo demand in H1 2024 was strong, particularly for e-commerce and traditional air freight, with overall cargo capacity growth exceeding last year's figures[21] - The Southeast Asia market remains strong, with increased passenger volume to mainland China due to visa exemptions, particularly during festive periods[19] - The company is expanding services to mainland China, with additional flights and increased capacity for personal travel plans, enhancing connectivity[16] Governance and Compliance - The company is committed to maintaining high standards of corporate governance and transparency in its operations[68] - The board of directors includes both executive and non-executive members, ensuring a diverse governance structure[71] - The chairman of the board is Ho Yat-Lai, with a team of directors overseeing the company's operations[71]

Core Viewpoint - The aviation sector is struggling to fully recover despite some positive operational data, with many airlines still in a state of loss and unable to achieve profitability [1][2][8]. Group 1: Passenger Flow and Demand - During the 2024 Qingming Festival, the total inter-regional passenger flow reached 750 million, with an average of 250 million per day, marking a 56.1% increase compared to the same period in 2023 and a 20.9% increase compared to 2019 [1]. - The aviation sector saw a passenger volume of 5.1 million during the holiday, which is a 24% increase year-on-year, but only a 2% increase compared to 2019, indicating weak demand relative to other transport modes [1][2]. Group 2: Financial Performance of Airlines - In 2023, only one out of six Hong Kong-listed airlines, Cathay Pacific, reported a profit of 9.067 billion, while the other five remained in loss, with China Eastern Airlines reporting a net loss of 8.168 billion [2][8]. - The overall loss for airlines in 2023 was approximately 17.1 billion, with a significant portion attributed to traditional off-peak seasons and rising oil prices [6][8]. Group 3: Operational Metrics - Domestic flight capacity has surpassed 2019 levels, with international flights recovering to over 60% by the end of 2023. Daily passenger flights averaged 13,514, a 6.5% decrease from 2019 [4]. - The passenger transport volume for domestic routes exceeded 380 million, showing a 1.5% increase compared to 2019, while international routes saw a significant decline of 58% [4][5]. Group 4: Future Outlook - The Civil Aviation Administration of China aims for a passenger transport volume of 690 million in 2024, representing an 11% increase from 2023 and a 4.6% increase from 2019 [8]. - The 2024 Spring Festival saw record passenger numbers, with 83.45 million transported, a 51.1% increase from 2023 and a 14.5% increase from 2019, indicating a potential recovery trend [8]. - Analysts predict a positive outlook for airline performance in 2024, driven by the recovery of international flights, improved cost conditions, and a favorable demand environment [8].

Financial Performance - Revenue increased by 85.1% to HKD 94,485 million in 2023 compared to HKD 51,036 million in 2022[6] - Net profit attributable to Cathay Pacific shareholders was HKD 9,789 million in 2023, a significant improvement from a loss of HKD 6,623 million in 2022[6] - Cathay Group recorded a profit attributable to shareholders of HKD 9.789 billion in 2023, compared to a loss of HKD 6.623 billion in 2022[10] - Cathay Pacific's post-tax profit for 2023 was HKD 11.341 billion, compared to a profit of HKD 1.434 billion in 2022[76] - Total revenue increased by 85.1% to HKD 94.485 billion in 2023[77] - Cathay Pacific's pre-tax profit for 2023 was HKD 10.042 billion, a significant improvement from HKD 2.456 billion in 2022[84] - Net profit for 2023 was HKD 9,790 million (USD 1,255 million), a significant improvement from a net loss of HKD 6,622 million (USD 849 million) in 2022[167] - Basic earnings per share for 2023 were HKD 140.8 cents (USD 18.1 cents), compared to a loss of HKD 112.4 cents (USD 14.4 cents) in 2022[167] - Total comprehensive income for 2023 was HKD 7,937 million (USD 1,018 million), recovering from a comprehensive loss of HKD 8,440 million (USD 1,082 million) in 2022[168] - The company reported a net profit of HKD 9,790 million for the year 2023, compared to a net loss of HKD 6,622 million in 2022[172] Operational Metrics - Available seat kilometers (ASK) surged by 326.8% to 85,607 million in 2023 from 20,056 million in 2022[6] - Passenger load factor improved by 12.1 percentage points to 85.7% in 2023 from 73.6% in 2022[6] - Cargo revenue ton kilometers (RTK) increased by 40.3% to 8,099 million in 2023 from 5,774 million in 2022[6] - Cathay Group's passenger flights recovered to 70% of pre-pandemic levels by the end of 2023, connecting Hong Kong to approximately 80 destinations[10] - Cathay Pacific carried 18 million passengers in 2023, a 541.4% increase from 2022, with an average daily passenger count of 49,300[18] - Cathay Pacific's passenger revenue reached HKD 55.95 billion, a 308.8% increase compared to 2022[18] - Cathay Pacific's cargo revenue decreased by 17.9% to HKD 22.16 billion in 2023, with cargo yield dropping by 41.3% to HKD 2.74[18] - Cathay Pacific's passenger traffic increased by 541.4% to 18 million passengers, with revenue passenger kilometers up by 396.8%[79] - Cathay Pacific's cargo load factor decreased to 62% in 2023 from 70.6% in 2022, but cargo yield remains 46.5% higher than pre-pandemic levels[18] - Cathay Pacific's passenger revenue in 2023 reached HKD 55.951 billion, a 308.8% increase compared to 2022[21] - Cathay Group operated passenger flights at 70% of pre-pandemic levels by the end of 2023, serving approximately 80 destinations[21] - Cathay Pacific carried 18 million passengers in 2023, with an average daily passenger count of 49,300, a 541.4% increase from 2022[21] - The load factor increased by 12.1 percentage points to 85.7% in 2023, while yield decreased by 17.7% to HKD 76.3 cents[21] - Available seat kilometers (ASK) increased by 326.8% in 2023, with the Americas region showing the highest increase at 213.6%[23] - The load factor for the Americas region reached 91.9% in 2023, an increase of 15.0 percentage points from 2022[23] - Cathay Pacific resumed flights from Guangzhou in March 2023, increasing frequency to twice daily[24] - The company introduced upstream port check-in and baggage check services for passengers traveling via the Hong Kong-Zhuhai-Macau Bridge starting August 2023[24] - Cathay Pacific celebrated 40 years of operations in the Americas, resuming the Chicago route in October 2023[25] - The London Heathrow route was restored to a maximum of five daily flights in 2023[26] - Cathay Pacific increased flights to mainland China to 170 weekly flights serving 15 cities and 16 airports by December 31, 2023[28] - The company operated flights to 23 destinations and 25 airports in North Asia by December 31, 2023[28] - Cathay Pacific resumed seasonal flights between Christchurch and Hong Kong in December 2023, marking the first seasonal flight restart since the pandemic[29] - The company operated flights to 7 destinations in South Asia, the Middle East, and Africa by December 31, 2023[30] - Cathay Pacific announced the purchase of up to 32 new Airbus A321neo and A320neo aircraft, expected to be delivered by 2029[32] - The company reopened all Cathay Pacific airport lounges globally, except for Paris Charles de Gaulle Airport, due to terminal maintenance[31] - Cathay Pacific launched a new lounge at Shenzhen Shekou Cruise Home Port, the first of its kind outside an airport in mainland China[31] - The company was ranked 9th in the AirlineRatings.com 2023 Top 25 Airlines in the World[32] - Cathay Pacific was awarded the "5-Star Global Airline" in the 2024 APEX Airline Awards[32] - The company received the "Best Inflight Entertainment" award in the 2023 Skytrax World Airline Awards[32] - Cathay Pacific's cargo revenue in 2023 was HKD 22.162 billion, a decrease of 17.9% compared to 2022[35] - Cargo yield in 2023 decreased by 41.3% to HKD 2.74, with an average load factor of 62%[35] - Available cargo ton kilometers (ACTK) in 2023 increased by 59.7% compared to 2022[37] - Cargo load factor in 2023 was 62.0%, a decrease of 8.6 percentage points from 2022[37] - Cargo revenue ton kilometers (RTK) in 2023 increased by 40.3% compared to 2022[35] - Total cargo tonnage in 2023 increased by 19.7% to 1.381 million tons[35] - Cathay Pacific operated cargo services to 11 destinations in the Americas and 5 in Europe as of December 31, 2023[38] - The company expanded its cross-Pacific routes in late 2023 to meet peak air cargo demand[38] - Cathay Pacific resumed cargo flights to mainland China cities starting in the summer of 2023[38] - The company increased passenger flights to Japan, South Korea, and Taiwan, noting an increase in inbound cargo tonnage[38] - Southeast Asia region saw a significant increase in cargo tonnage to Hong Kong and North Asia due to expanded belly cargo services[40] - Operated cargo services to 5 destinations and belly cargo services to 12 destinations in Southeast Asia as of December 31, 2023[40] - Operated cargo services to 3 destinations and belly cargo services to 5 destinations in the Southwest Pacific region as of December 31, 2023[40] - Cargo flights to Dhaka were reduced from 3 to 2 per week starting January 19, 2023[40] - Cargo flights to Chennai and Delhi were reduced by 1 per week starting winter 2023[40] - Cargo services to Bangalore were suspended starting winter 2023[40] - Announced purchase of 6 new Airbus A350F cargo aircraft with an option for 20 more, with first deliveries expected in early 2027[43] - Nearly half of cargo bookings are now made through the upgraded online booking platform "Book & Go"[40] - Successfully conducted the world's first ONE Record cargo arrangement pilot program with Hong Kong Airport Authority[41] - Cathay Cargo won "Air Cargo Airline of the Year" at the 49th Air Transport World (ATW) Industry Achievement Awards[45] - Cathay Pacific increased the number of redeemable seats per flight by 100% compared to pre-pandemic levels[49] - Cathay Pacific launched a full-mileage redemption website in August 2023, allowing redemptions for popular destinations starting at 3,000 miles[49] - Cathay Pacific's subsidiary, HK Express, resumed flights to pre-pandemic levels in April 2023, operating 130% of pre-pandemic capacity by the end of 2023[53] - HK Express achieved an average load factor of 86% in 2023, a 17.7 percentage point increase from 2022[53] - Cathay Pacific's subsidiary profits in 2023 were HKD 10 million, compared to a loss of HKD 1.764 billion in 2022[52] - Cathay Pacific's associated company losses in 2023 were HKD 1.562 billion, compared to a loss of HKD 6.293 billion in 2022[52] - Hong Kong Express resumed daily flights to Ningbo in March, returning to pre-pandemic levels[54] - Hong Kong Express operated weekly approximately 230 flights serving 15 destinations in North Asia as of December 31, 2023[54] - Hong Kong Express launched daily flights to Hanoi in April and resumed Nha Trang route in June, increasing Vietnam destinations to three[55] - Hong Kong Express operated weekly approximately 72 flights serving 7 destinations in Southeast Asia as of December 31, 2023[55] - Hong Kong Express introduced a customer carbon offset program in October 2023, partnering with CHOOOSE[56] - Hong Kong Express' fleet consisted of 33 Airbus narrow-body aircraft with an average age of 7.1 years as of December 31, 2023[58] - Hong Kong Express received the first 4 Airbus A321-200neo aircraft in 2023, part of a previous order of 16[58] - Hong Kong Express announced the purchase of up to 32 new Airbus A321neo and A320neo aircraft, expected to be delivered by 2029[58] - Hong Kong Express' passenger revenue increased by 749.2% to HK$5,486 million in 2023[60] - Hong Kong Express' available seat kilometers increased by 859.5% to 9,432 million in 2023[61] - Cathay Pacific Catering Services produced 19.4 million meals and handled 43,389 flights in 2023, representing a 379% and 170% increase respectively compared to 2022[63] - Cathay Pacific Cargo Terminal handled 1.4 million tons of cargo in 2023, a 17% increase from 2022[64] - Hong Kong Airport Ground Services accounted for 45% and 17% of the apron and ground handling services market at Hong Kong International Airport in 2023, with flight numbers increasing by 134% and 426% respectively compared to 2022[64] Fleet and Aircraft - The company operates a fleet of 230 aircraft, with 75 new passenger and cargo aircraft expected to join the fleet in the coming years[5] - Cathay Group's total fleet consisted of 230 aircraft with an average age of 10.8 years as of December 31, 2023[7] - Cathay Group has 75 aircraft on order, including 57 for delivery in 2026 and beyond[7] - Cathay Pacific's fleet included 181 aircraft with an average age of 11.1 years as of December 31, 2023[7] - Hong Kong Express's fleet consisted of 33 aircraft with an average age of 7.1 years as of December 31, 2023[7] - Air Hong Kong plans to return 7 A300-600F freighters by 2025 and replace them with 6 second-hand A330F freighters, maintaining a fleet of 15 aircraft[8] - The company announced the purchase of an additional 32 Airbus A321neo and A320neo aircraft, bringing the total number of new aircraft ordered to over 70, with the option to purchase an additional 52[16] - Cathay Pacific will introduce new cabin products, including a redesigned business class and premium economy class on Boeing 777-300ER aircraft in 2024[19] - The company held 28 aircraft under lease agreements as of December 31, 2023, with ownership transferring at the end of the lease term or with a reasonably certain purchase option[188] - The company held 46 aircraft under lease agreements as of December 31, 2023, with ownership not transferring at the end of the lease term[188] - The confirmed lease liability (discounted) for aircraft and related equipment was HKD 26,146 million in 2023, down from HKD 28,683 million in 2022[189] - The potential future lease payments not included in lease liabilities due to extension options were HKD 4,375 million in 2023, down from HKD 5,228 million in 2022[189] - The company prepaid HKD 32.31 billion for aircraft and related equipment to manufacturers as of December 31, 2023, up from HKD 29.64 billion in 2022[192] - The company recognized a HKD 208 million impairment reversal for three previously impaired aircraft that were returned to service[192] - The total prepayments for intangible assets were HKD 20.805 billion as of December 31, 2023, up from HKD 20.468 billion in 2022[193] - The goodwill allocated to Cathay Pacific was HKD 7.884 billion as of December 31, 2023, unchanged from 2022[195] - The discount rate used for the discounted cash flow analysis of Cathay Pacific's cash-generating unit was 9.6% in 2023, up from 9.5% in 2022[195] - The long-term growth rate assumption for cash flows beyond the forecast period was 3% in 2023, unchanged from 2022[195] Financial Position and Liquidity - The company's debt-to-equity ratio decreased to 0.88 times in 2023 from 0.92 times in 2022[6] - Cathay Group's unrestricted available liquidity stood at HKD 20 billion as of December 31, 2023[10] - The company repurchased 50% of the preferred shares in December 2023, amounting to HKD 9.75 billion, with plans to repurchase the remaining 50% by the end of July 2024[11] - The company paid approximately HKD 1.97 billion in preferred stock dividends to the Hong Kong Special Administrative Region Government in 2023[11] - Total assets as of December 31, 2023, amounted to HKD 174,115 million, with significant increases in property, plant, and equipment (HKD 8,731 million) and intangible assets (HKD 340 million)[87] - Borrowings decreased by 11.4% to HKD 68,294 million, with net borrowings (excluding lease liabilities) down by 10.1% to HKD 56,973 million[88] - Unrestricted available liquidity stood at HKD 19,985 million as of December 31, 2023, including HKD 15,530 million in liquid funds and HKD 4,460 million in committed unused credit[88] - Net debt (excluding lease liabilities) decreased by 8% to HKD 41,443 million[88] - Shareholders' equity decreased by 5.9% to HKD 60,226 million, primarily due to the redemption of HKD 9,750 million in preference shares and a reduction in other comprehensive income of HKD 1,853 million[91] - The company recorded a profit of HKD 9,789 million (excluding non-controlling interests), partially offset by dividends paid to preference shareholders of HKD 1,969 million[92] - Unused proceeds from the issuance of equity securities, including HKD 31.1 billion raised in 2020, were fully utilized for general corporate purposes in the first half of 2023[93] - The company proposed a dividend of HKD 2,768 million for the year, with a per-share dividend of HKD 0.43[87] - Total assets decreased to HKD 128,622 million in 2023 from HKD 137,512 million in 2022[169] - Net current liabilities increased to HKD 22,744 million in 2023 from HKD 17,066 million in 2022[169] - Property, plant, and equipment decreased to HKD 116,088 million in 2023 from HKD 118,855 million in 2022[169] - Intangible assets decreased to HKD 14,539 million in 2023 from HKD 14,800 million in 2022[169] - Cash and cash equivalents increased to HKD 7,894 million in 2023 from HKD 7,340 million in 2022[170] - Net cash inflow from operating activities increased to HKD 26,408 million in 2023 from HKD 17,836 million in 2022[170] - Net cash outflow from investing activities decreased to HKD 2,668 million in 2023 from HKD 2,760 million in 2022[170] - Net cash outflow from financing activities increased to HKD 23,178 million in 2023 from HKD 16,236 million in 2022[170] - Interest-bearing liabilities decreased to HKD 57,771 million in 2023 from HKD 62,463 million in 2022[169] - Share capital decreased to HKD 28,828 million in 2023 from HKD 48,322 million in 2022[169] - Cathay Pacific's total equity increased to HKD 60,033 million in

Financial Performance - The total revenue for Cathay Pacific in 2023 was HKD 94,485 million, an increase of 85.1% compared to HKD 51,036 million in 2022[3]. - The net profit attributable to shareholders was HKD 9,789 million, a significant turnaround from a loss of HKD 6,623 million in 2022, representing an increase of HKD 16,412 million[3]. - The basic earnings per share rose to HKD 1.408, compared to a loss of HKD 1.124 in 2022, marking an increase of 253.2%[3]. - The operating margin improved to 10.4%, a rise of 23.4 percentage points from a loss of 13.0% in 2022[3]. - The group reported a net profit of HKD 9,790 million for the year, a substantial improvement from a net loss of HKD 6,623 million in the previous year[58]. - The operating profit for Cathay Pacific in 2023 was HKD 15,125 million, compared to a loss of HKD 6,622 million in 2022, indicating a strong recovery[58]. - The company reported a profit of HKD 9,790 million for the year ended December 31, 2023, compared to a loss of HKD 6,622 million in 2022[46]. - Total comprehensive income for the year was HKD 7,937 million, a significant improvement from a loss of HKD 8,440 million in the previous year[47]. Revenue Breakdown - Cathay Pacific's passenger revenue reached HKD 55.95 billion, an increase of 308.8% compared to 2022[15]. - Passenger service revenue reached HKD 61,437 million, up 328.6% from HKD 14,333 million in 2022[33]. - Cargo service revenue decreased by 16.2% to HKD 25,606 million from HKD 30,554 million in 2022[33]. - Cargo revenue for Cathay Pacific in 2023 was HKD 22.16 billion, a decrease of 17.9% from 2022[15]. Operational Metrics - The available tonne-kilometers increased by 110.1% to 21,225 million from 10,100 million in 2022[4]. - The total available seat-kilometers surged by 326.8% to 85,607 million from 20,056 million in 2022[4]. - The passenger load factor improved to 85.7%, up by 12.1 percentage points from 73.6% in 2022[4]. - The overall cargo tonnage increased by 19.7% to 1.381 million tons in 2023[15]. - The number of passengers carried in 2023 was 18 million, averaging 49,300 passengers per day, a 541.4% increase from 2022[15]. Debt and Financial Health - The net debt ratio decreased to 0.88 times from 0.92 times in 2022, reflecting a reduction in net borrowings by 10.3% to HKD 52,764 million[2]. - Total borrowings decreased by 11.4% to HKD 68,294 million, with net borrowings down 10.3% to HKD 52,764 million[40]. - The debt-to-equity ratio improved from 0.71 to 0.69, indicating a stronger balance sheet position[40]. - The company's equity attributable to shareholders decreased by 5.9% to HKD 60,260 million, impacted by a profit of HKD 9,789 million and various other factors[40]. Workforce and Employment - The workforce increased by 15% or 3,000 employees in 2023, with nearly 2,000 former employees rehired[12]. - The company plans to increase its workforce by approximately 5,000 employees in 2024, a 20% increase from 2023[17]. - The company employed over 23,800 staff globally as of December 31, 2023, with approximately 19,600 based in Hong Kong[42]. Strategic Initiatives - The group plans to distribute a dividend of HKD 0.43 per ordinary share, the first since 2019, to be paid on May 2, 2024[7]. - Cathay Pacific has initiated a share buyback program, repurchasing 50% of the preferred shares for HKD 9.75 billion in December 2023[8]. - The company plans to expand its sustainable aviation fuel supply chain in mainland China in partnership with State Power Investment Corporation[42]. - The company aims to enhance customer experience by reopening most airport lounges and launching a lounge in Shekou, Shenzhen[13]. Environmental Impact - The greenhouse gas emissions rose to 10.6 million tonnes CO2 equivalent, an increase of 116.3% from 4.9 million tonnes in 2022[4]. Future Outlook - Passenger flights are expected to return to 80% of pre-pandemic levels by Q2 2024, with ticket prices normalizing throughout the remainder of 2024[9]. - Cathay Pacific aims to restore passenger flight operations to 80% of pre-pandemic levels by Q2 2024 and 100% by Q1 2025[17]. - The company plans to introduce new cabin products over the next three years, including a new business class and first-class experience[17]. Corporate Governance - The company has adhered to all corporate governance codes as per the listing rules throughout the year[92]. - All directors confirmed compliance with the securities trading code and the standard code for directors[92]. - The financial results for the year ending December 31, 2023, have been reviewed by the audit committee[92].

Financial Performance - The group reported a revenue of HKD 43,593 million for the six months ended June 30, 2023, representing a 135.0% increase compared to HKD 18,551 million in the same period of 2022[5]. - Cathay Pacific's attributable profit to shareholders was HKD 4,268 million, a significant turnaround from a loss of HKD 4,999 million in the previous year[5]. - The basic earnings per share increased to HKD 61.5, compared to a loss of HKD 82.3 in the same period last year, marking a 143.8% improvement[5]. - Cathay Pacific recorded a profit of HKD 4.26 billion in the first half of 2023, compared to a loss of HKD 4.99 billion in the same period of 2022[8]. - The net profit after tax for the first half of 2023 was HKD 333 million, a recovery from a loss of HKD 824 million in the same period last year[21]. - The company reported a profit of HKD 4,268 million for the six months ended June 30, 2023, compared to a loss of HKD 4,999 million in the same period of 2022, indicating a turnaround in performance[47]. - The total comprehensive income for the period was HKD 4,268 million, compared to a loss of HKD 4,999 million in the prior year[35]. - The company reported a significant increase in employee expenses to HKD 6,612 million from HKD 5,057 million, an increase of 31%[43]. Operational Metrics - The group’s available tonne-kilometers (ATK) increased by 211.2% to 9,628 million, while available seat-kilometers (ASK) surged by 1,111.3% to 37,053 million[6]. - The passenger load factor improved to 87.2%, up by 28.0 percentage points from 59.2% in the previous year[6]. - The average daily passenger count reached 43,180, up 2,233.1% compared to the same period in 2022[9]. - The total number of passengers carried in the first half of 2023 reached 7.8 million, averaging 43,184 passengers per day, a 2,233.1% increase compared to the same period in 2022[12]. - The average load factor for Hong Kong Express in the first half of 2023 was 85.5%, an increase of 67 percentage points compared to the same period in 2022[20]. - The company operated flights to 70 destinations with a capacity reaching 50% of pre-pandemic levels by March 2023[12]. Cargo Operations - Cargo revenue tonne-kilometers increased by 83.0% to 3,886 million, reflecting strong demand in the air freight sector[6]. - Cargo volume increased by 83% year-on-year, with total cargo tonnage rising by 23.8% to 651,000 tons[8]. - Cargo revenue for the first half of 2023 was HKD 10.74 billion, a decrease of 11.6% year-on-year[9]. - The cargo load factor decreased to 63.8% from 75.8% in the first half of 2022[8]. - The cargo revenue yield decreased by 51.7% to HKD 2.76 per ton-kilometer[8]. - Available cargo tonne-kilometers increased by 117.6% to 6,095 million in the first half of 2023, while the load factor decreased by 12.0 percentage points to 63.8%[18]. Fleet and Staff - The fleet consisted of 225 aircraft, with 42 new passenger aircraft expected to join in the coming years[4]. - The average age of the fleet was 11.0 years, slightly down from 11.3 years in the previous year, indicating ongoing fleet modernization efforts[6]. - The group employed over 21,900 staff globally, with approximately 18,100 based in Hong Kong as of June 30, 2023[4]. - The average age of the fleet is 11.0 years, with a total of 136 aircraft owned and 28 leased as of June 2023[7]. Financial Stability - The net debt decreased by 24.2% to HKD 44,565 million from HKD 58,829 million, indicating improved financial stability[5]. - The group’s available unrestricted cash amounted to HKD 28,899 million, including HKD 24,099 million in cash and HKD 4,913 million in undrawn credit facilities[38]. - The debt-to-equity ratio improved from 0.71 times to 0.50 times, indicating a stronger balance sheet position[38]. - The company has available unrestricted cash of HKD 28,896 million as of June 30, 2023, compared to HKD 27,188 million at the end of 2022, indicating an increase of about 6.3%[74]. Future Plans and Strategies - The group aims to restore its passenger capacity to 70% of pre-pandemic levels by the end of 2023, serving 80 destinations[10]. - The group expects to receive five new aircraft in the second half of 2023, following the delivery of five new aircraft in the first half[7]. - The company plans to replace eight Airbus A300-600F freighters with eight second-hand Airbus A330F freighters by 2024[7]. - The company plans to continue expanding its market presence and investing in new technologies to enhance operational efficiency[43]. - The company is collaborating with the National Energy Investment Group to promote the sustainable aviation fuel supply chain in mainland China[27]. Awards and Recognition - Cathay Pacific's premium customer service received 12 awards, including the "Excellence in Service Award" at the 2022 Quality Customer Service Awards[16]. - Cathay Pacific was recognized as one of the top 25 airlines globally by AirlineRatings.com, ranking 9th[17]. - Cathay Pacific received multiple awards in 2023, including recognition for its commitment to sustainable tourism and diversity[30]. Sustainability Initiatives - Cathay Pacific has reduced single-use plastic usage by 56% compared to 2018 levels and is establishing new plastic and waste reduction targets[28]. - The company processed 28 million items of laundry in the first half of 2023, a significant increase from 12 million items in the same period of 2022[25]. - The company is set to host the International Cargo Symposium in March 2024, emphasizing its commitment to the air cargo sector[18]. Corporate Governance and Compliance - The company complied with all corporate governance codes as per the Hong Kong Stock Exchange Listing Rules during the reporting period[92]. - The company acknowledges potential risks and uncertainties affecting future performance, including economic conditions and geopolitical factors[97]. - The company emphasizes that forward-looking statements are based on various assumptions and may not guarantee future results[97].

Financial Performance - The revenue for the first half of 2023 reached HKD 43,593 million, a significant increase of 135.0% compared to HKD 18,551 million in the same period of 2022[2] - Cathay Pacific reported a profit attributable to shareholders of HKD 4,268 million, a turnaround from a loss of HKD 4,999 million in the previous year, representing an improvement of HKD 9,267 million[2] - The basic earnings per share increased to HKD 61.5, up 143.8% from a loss of HKD 82.3 per share in the same period last year[2] - The company reported a net profit of HKD 4,268 million for the first half of 2023, compared to a net loss of HKD 4,999 million in the same period last year[31] - The airline's profit before tax for the first half of 2023 was HKD 4,707 million, compared to a loss of HKD 5,348 million in the previous year[40] - The group achieved a net profit of HKD 4,268 million attributable to shareholders, a significant recovery from a loss of HKD 4,999 million in the prior year[40] - The adjusted profit before tax for the first half of 2023 was HKD 4,890 million, a significant improvement from a loss of HKD 1,544 million in the same period of 2022, representing a change of HKD 6,434 million[25] Operational Metrics - The available tonne-kilometers (ATK) increased by 211.2% to 9,628 million, compared to 3,094 million in the previous year[4] - The passenger load factor improved to 87.2%, an increase of 28.0 percentage points from 59.2% in the same period last year[4] - The available seat-kilometers (ASK) surged by 1,111.3% to 37,053 million, compared to 3,059 million in the previous year[4] - The number of passengers carried reached 7.8 million, averaging 43,184 passengers per day, a 2,213.1% increase compared to the first half of 2022[7] - Passenger service revenue reached HKD 27,563 million, while cargo service revenue was HKD 12,432 million, indicating strong recovery in both segments[31] Cost and Expenses - Non-fuel costs for the first half of 2023 were HKD 24.639 billion, a 53.5% increase compared to the same period in 2022[8] - Total fuel costs increased by HKD 6.085 billion, or 147.8%, compared to the first half of 2022[8] - The total operating expenses for Cathay Pacific increased by 81.4% to HKD 38,403 million for the six months ended June 30, 2023, compared to HKD 21,173 million in the same period of 2022[24] - Cathay Pacific's operating expenses increased due to higher fuel prices and operational costs, impacting overall profitability[40] Debt and Financial Stability - The net debt decreased by 24.2% to HKD 44,565 million from HKD 58,829 million at the end of 2022[3] - Total borrowings decreased to HKD 68.664 billion, a reduction of 10.9%, with net borrowings decreasing by 24.2% to HKD 44.656 billion[28] - The net debt-to-equity ratio decreased from 0.71 times to 0.50 times, reflecting improved financial stability[28] - The company's available unrestricted cash amounted to HKD 28.896 billion, including HKD 24.099 billion in cash and HKD 4.913 billion in undrawn credit facilities[28] Future Outlook and Expansion - The group expects to receive five new aircraft in the second half of 2023, enhancing fleet capacity[5] - Passenger capacity is expected to reach 70% of pre-pandemic levels by the end of 2023, serving 80 destinations, with a goal of 100% by the end of 2024[10] - The group anticipates further increases in capacity and flight frequencies to meet rising passenger demand[6] - The company is focusing on talent acquisition from the Greater Bay Area to support its business expansion[30] Environmental Initiatives - The company has successfully offset over 300,000 tons of carbon dioxide through its voluntary carbon offset program since its launch in 2007[30] - Cathay Pacific has signed a memorandum of understanding with State Power Investment Corporation to develop a sustainable aviation fuel supply chain in mainland China[30] Corporate Governance - The company has adhered to all corporate governance codes as per the Hong Kong Stock Exchange Listing Rules during the reporting period[59] - The board of directors includes both executive and independent non-executive members, ensuring a diverse governance structure[62] Miscellaneous - The company resumed seasonal flights to Christchurch, New Zealand, starting December 16, marking the first seasonal flight restoration since the pandemic[18] - The company announced the resumption of three weekly flights between Hong Kong and Johannesburg starting August 1, reconnecting Hong Kong with Africa[18] - The group recognized a profit of HKD 1.929 billion from its stake in Air China due to a reduction in ownership from 18.13% to 16.26% after a share issuance[29] - The interim report for 2023 will be published on or before August 24, 2023, and printed copies will be sent to shareholders who opted for them on August 25, 2023[60] - The company acknowledges that forward-looking statements may be subject to risks and uncertainties, including economic conditions and geopolitical factors[61]

Financial Performance - The group reported a revenue of HKD 51,036 million for 2022, an increase of 12.0% compared to HKD 45,587 million in 2021[4]. - Cathay Pacific's attributable loss to shareholders was HKD (6,548) million, representing an increase of 18.5% from HKD (5,527) million in the previous year[4]. - The group achieved a profit of HKD 2.26 billion in the second half of 2022, but incurred a loss of HKD 15.49 billion for the first half of the year[8]. - Cathay Pacific recorded a loss of HKD 6.54 billion for the year 2022, compared to a loss of HKD 5.52 billion in 2021[8]. - The company reported a significant increase in sales from North Asia, generating HKD 34,456 million in 2022, up from HKD 31,974 million in 2021, marking a growth of 7.8%[160]. - The company reported a net loss after tax of HKD 1.36 billion in 2022, compared to a loss of HKD 1.98 billion in 2021, reflecting a 31.3% improvement[37]. - The company reported a loss of HKD 6,548 million for the year, compared to a loss of HKD 5,527 million in 2021, representing a 18.5% increase in losses[156]. - The company incurred financial expenses of HKD 3,074 million, an increase from HKD 2,704 million in the previous year[152]. - The company reported a total comprehensive loss for the year amounted to HKD 8,365 million, compared to a total comprehensive loss of HKD 1,538 million in 2021[152]. Operational Statistics - The passenger load factor improved to 73.6%, up by 42.5 percentage points from 31.1% in 2021[5]. - Available seat kilometers increased by 51.6% to 20,056 million from 13,228 million in 2021[5]. - The average age of the fleet increased to 10.8 years from 10.5 years in 2021[5]. - The operating statistics showed a decrease in available ton kilometers by 11.0% to 10,100 million from 11,354 million in 2021[5]. - In 2022, Cathay Pacific carried 2.8 million passengers, with an average daily load of 7,682 passengers, representing a 291.1% increase compared to 2021[12]. - The overall cargo tonnage decreased by 13.4% to 1,154,000 tons, with a cargo load factor of 70.6% compared to 81.4% in 2021[12]. - The airline's available seat capacity is expected to reach approximately 70% of pre-pandemic levels by the end of 2023, with a goal to fully recover by the end of 2024[9]. - The company operated approximately 3,000 additional passenger flights in Q4 2022, with capacity reaching one-third of pre-pandemic levels[12]. Environmental Initiatives - The greenhouse gas emissions reduced by 12.5% to 4.9 million tons CO2 equivalent from 5.6 million tons in the previous year[5]. - Cathay Pacific aims to achieve a mid-term target of using sustainable aviation fuel for 10% of total fuel consumption by 2030[138]. - The company signed a purchase agreement with Aemetis to start procuring blended sustainable aviation fuel from 2025[138]. - Cathay Pacific's plastic recycling increased significantly by 1,147.2% to 21,016 kg in 2022, compared to 1,685 kg in 2021[136]. - The company reduced single-use plastic consumption by 56% as of 2022, surpassing its goal of halving usage by the end of 2022[140]. - Cathay Pacific offset 38,399 tons of CO2 in 2022 through its voluntary "Fly Greener" carbon offset program, with over 300,000 tons purchased since its launch in 2007[140]. Fleet and Capacity Expansion - The group plans to add 48 new aircraft to its fleet in the coming years[3]. - The company received five new aircraft in 2022 and expects to receive eleven more in 2023, enhancing fleet modernization and efficiency[32]. - As of December 31, 2022, Cathay Pacific operated a fleet of 181 aircraft, with a total of 222 aircraft across the group[31]. - The company plans to replace nine Airbus A300-600F freighters with nine second-hand Airbus A330F freighters by 2024[33]. Financial Management and Debt - The net debt to equity ratio improved to 0.92 from 0.98 in the previous year, a decrease of 0.06 times[4]. - As of December 31, 2022, the group had unrestricted cash reserves of HKD 27.2 billion[8]. - The company issued 1.676 billion A shares, raising RMB 15 billion, resulting in a dilution of its stake in Air China from 18.13% to 16.26%[41]. - The company recorded a significant loss of HKD 6.29 billion from associates, primarily due to delays in confirmations[8]. - The company has a total borrowing of HKD 100 billion, with a significant portion in fixed and floating interest arrangements[60]. Customer Engagement and Loyalty Programs - The new Marco Polo Club program was launched, merging with Asia Miles, resulting in over 13 million members[13]. - The company aims to enhance customer loyalty through data-driven insights into customer preferences for its services[13]. - Membership redemption for Cathay Pacific flights increased by 153% year-on-year, while non-flight rewards rose by 43%[27]. - The company launched the "Cathay Miles" program, offering over 70,000 seats for passengers to redeem for flights[24]. Corporate Governance and Compliance - The company has adopted a self-developed corporate governance code, which is available on its website[86]. - The board of directors is responsible for the strategic leadership and oversight of the group, aiming to maximize returns for shareholders while considering the interests of business partners and other stakeholders[87]. - The company has established a risk management and internal control system, which is regularly reviewed for effectiveness[113]. - The audit committee is responsible for recommending the appointment of external auditors to the board for shareholder approval[117]. Community Engagement and Social Responsibility - The company donated nearly 390,000 items to support vulnerable communities in Hong Kong during 2022, including over 110 tons of surplus food[142]. - Employees contributed approximately 1,720 hours of volunteer work during the pandemic, supporting various non-profit organizations[143]. - The "Spare Change Donation" program has raised over HKD 200 million for UNICEF since its inception in 1991, with approximately HKD 810,000 raised in the most recent audited year[143].