Freighter Queen

NEWS
Message from the Chief Executive
Ivan Chu
In recent months we have talked a lot
about the operating environment being
“difficult” – and just how difficult it has
been was brought into sharp focus in
our interim results.
We declared a modest profit,
thanks largely to the contribution from
subsidiary and associate companies,
but the sharp fall in income resulted in
an operating loss of HK$783 million – a
big drop compared to the previous year.
To see our passenger revenue decline
by 8% and our cargo revenue plunge
by 17% is of great concern, especially
when volumes have been holding up
quite well.
While the second half of the year is
usually better than the first, we believe
that this year it will not be as strong as
the second six months in 2015. We
expect to see our business affected
by the same adverse factors, including
ever-stronger competition, pressure
on yield, currency movements working
against us, general economic weakness,
and the impact of security concerns.
So what we can do in the face of
such challenges? We have shown we
can react quickly to market changes,
introducing the successful Vantage
Pass promotion this summer to
make up for the shortfall in corporate
premium traffic. We will need to
continue to be smart and nimble as our
sales teams face up to the challenge
of getting the right balance between
market share and yield.
On the cost side we should still
benefit from low fuel prices, while our
unit cost per ATK excluding fuel has
been trending downwards thanks
to a great effort from the team. The
measures that we announced earlier
in the year to curtail costs and improve
productivity will remain in place, and I
ask all of you to keep this as a key focus
through into 2017.
Whatever challenges we face in the
short- to medium-term, our robust
financial position will enable us to keep
making the investments needed to
retain our competitive edge and deliver
on our promise of a Life Well Travelled.
With the help of our superb team, I feel
confident that we can weather this
storm and come out stronger on the
other side!
Farewell to the Queen
Emotions run high as we get set to say goodbye to our passenger 747s
• Three 747-400s left in our passenger fleet
• Fleet to retire in October; last revenue flight on 1 October from Tokyo Haneda
• Staff can participate in special farewell flight on 8 October over HK airspace
It’s going to be a sad moment for many colleagues when the final Boeing 747-400
passenger aircraft leave the fleet in early October.
Among the three remaining “Queen of the Skies” in operation, B-HUJ, B-HUI and
B-HKT, one will end revenue service on 30 September.
On the same day, the other two 744s will operate as overnight flights to Haneda
and Taipei, getting ready for their last commercial flights back to Hong Kong.
On 1 October, the last 747-400 departing Taipei Taoyuan Airport will operate as
CX469, scheduled to arrive in Hong Kong at 12:10pm.
The last 747-400 out of Tokyo Haneda will operate as CX543, arriving at 2:10pm.
“If all goes according to plan, that CX543 service will be our last-ever 747
commercial flight for passengers,” says Tony Britton, Aircraft Project Manager -
Lease, Return & Dispense.
The intention is to operate that service with B-HUJ, which has a significant place
in Cathay history.
“It is was the last of our 747 passenger aircraft delivered to Cathay in May 1995.
It also operated Polar 1, the very first transpolar non-stop flight from New York to
Hong Kong, which was also the first commercial flight to arrive at Chek Lap Kok on
the morning of 7 July 1998,” Tony explains.
“It seems fitting that this aircraft should be used for the last 747 revenue flight and
also the special flight on 8 October (see right).”
All three aircraft will undergo pre-retirement maintenance, including engine swaps
and work to retain certain components, before being ferried to a yet-to-be-decided
final retirement destination.
“Sadly, once we have completed our parts salvage, the aircraft will be deregistered
and ultimately broken down,” Tony says.
A flight to remember
The last ever flight for B-HUJ will be Special Farewell Flight CX8747, which will cruise over the skies of
Hong Kong on 8 August carrying upwards of 300 of our people, together with some special guests.
There was a great response to a competition run on IntraCX, which asked people to recall their special
memories of the 747 to win one of 20 guaranteed places on CX8747.
More than 250 of the seats on the flight will be opened up to other colleagues, who will be asked to pay
a minimum of HK$747 to enjoy a very memorable day out.
Look out on Daily News on 26 August for the chance to get your place on the flight!
Performance index
60
50
40
30
Mar16
Fuel price
Rolling 6 months
Sing Jet Kerosene
ICE Brent
Aug16
80
70
60
50
40
30
20
Feb 16
On-time
performance
Within 15 mins
On-the-dot
71.9%
41.5%
Jul16
Traffic vs capacity
(CX + KA)*
Passengers carried 3,070,815 2.9%
Passenger load factor 87.0% 0pt
ASKs (000) 12,723,458 2.6%
Freight carried 158,022 7.1%
Cargo load factor 64.7% 2.9pt
ATKs (000) 2,644,617 1.8%
* Figures for Jul16
Publisher Tom Owen
Managing Editor Mark Tindall
Editor Kawai Wong
Produced by the People Department
8/F North Tower, Cathay City, HK
PNL#COM@cathaypacific.com