CATHAY PAC AIR(00293)2021-04-07 08:39Financial Performance - The group's revenue for 2020 was HKD 46,934 million, a decrease of 56.1% compared to HKD 106,973 million in 2019[7]. - Cathay Pacific reported a loss attributable to shareholders of HKD 21,648 million in 2020, compared to a profit of HKD 1,691 million in 2019, representing a decline of HKD 23,339 million[7]. - The company reported a net loss of HKD 21,648 million for the year 2020, compared to a profit of HKD 1,691 million in 2019, marking a substantial year-over-year decline[147]. - The total comprehensive income for the year was significantly affected by the pandemic, leading to substantial losses across various segments[155]. - The company reported a total comprehensive loss of HKD 20,654 million for the year[142]. - The operating loss for the year was HKD 58,639 million, compared to an operating profit of HKD 3,441 million in 2019[142]. - The company incurred impairment and related expenses of HKD 28,815 million primarily related to 34 aircraft expected to be retired or returned to lessors[57]. - The company reported a significant impairment and related expenses of HKD (4,056) million, reflecting the challenging market conditions faced during the year[148]. Passenger and Cargo Operations - The passenger load factor decreased to 58.0% in 2020 from 82.3% in 2019, a drop of 24.3 percentage points[8]. - Passenger revenue for 2020 decreased by 84.3% to HKD 11.313 billion, with passenger numbers dropping by 86.9% compared to 2019[11]. - Cargo revenue ton kilometers decreased by 26.5% to 8,309 million in 2020 from 11,311 million in 2019[8]. - Cathay Pacific's cargo revenue for 2020 was HKD 24.57 billion, an increase of 16.2% compared to 2019, reflecting an imbalance between available cargo capacity and demand[12]. - The cargo load factor increased by 8.9 percentage points, with cargo yield rising by 58.3% to HKD 2.96[48]. - The company carried 460,000 passengers in 2020, a decrease of 86.9% compared to 2019, with revenue dropping 84.3% to HKD 11.31 billion[22]. Restructuring and Cost Management - The company implemented a corporate restructuring plan, resulting in a cost of approximately HKD 2.4 billion, saving around HKD 0.5 billion monthly[11]. - The restructuring plan involves a reduction of 8,500 positions, approximately 24% of the workforce, to improve operational efficiency[21]. - The company plans to maintain cash preservation measures, with senior management salary reductions continuing throughout 2021[13]. - The company announced a capital restructuring plan of HKD 39 billion in June 2020, supported by the Hong Kong SAR government and shareholders[10]. Government Support - The company received government support of HKD 2.689 billion related to the COVID-19 pandemic[10]. - The group received government support of HKD 16.89 billion related to the COVID-19 pandemic[44]. - The company received approximately HKD 26.89 billion in government support related to the COVID-19 pandemic[16]. Fleet and Operations - The average age of the fleet was 10.1 years in 2020, slightly down from 10.3 years in 2019[8]. - The group plans to delay the delivery of 60 new aircraft due to the pandemic[5]. - The company has reached an agreement with Airbus to delay the delivery of A350-900 and A350-1000 aircraft to 2023, and A321neo deliveries to 2025[12]. - The company ceased operations of Cathay Dragon by the end of 2020, affecting approximately 8,500 jobs[10]. Environmental and Social Responsibility - Cathay Pacific aims to achieve net zero carbon emissions by 2050 and is collaborating with governments and the UN to meet this goal[73]. - The company has set a target to halve its single-use plastic footprint by the end of 2022, based on 2018 levels, having already removed over 46 million single-use plastic items[73]. - The "ChangeMakers" program continued in 2020, focusing on environmental protection, youth development, and cultural integration[74]. - The company collected and donated over 648 tons of surplus food in 2020[74]. Corporate Governance - The company adheres to high standards of corporate governance, reflecting a commitment to integrity, transparency, and responsible conduct[103]. - The board of directors is responsible for the strategic leadership and oversight of the group, ensuring maximum returns for shareholders while considering the interests of stakeholders[103]. - The company has established various committees, including audit, remuneration, and risk management, to assist in fulfilling its responsibilities[104]. Financial Position and Liabilities - The total assets of the group as of December 31, 2020, amounted to HKD 204.57 billion, with an increase in property, plant, and equipment by HKD 8.72 billion during the year[62]. - The group’s total liabilities increased significantly, with borrowings and lease repayments totaling HKD (30,134) million in 2020, up from HKD (18,785) million in 2019[146]. - The adjusted net debt ratio, excluding lease liabilities, improved to 0.75 in 2020 from 0.99 in 2019[179]. Future Outlook - The company anticipates that passenger capacity in the first half of 2021 will be less than 25% of pre-pandemic levels, with overall capacity expected to be down by over 50% for the year[13]. - The management's basic scenario assumes passenger traffic will start to recover in the second half of 2021 but will not return to pre-crisis levels until 2024[170]. - The company plans to focus on market expansion and new product development in the upcoming year[142].