© Reuters. FILE PHOTO: Airplanes from Cathay Pacific and its regional brand Cathay Dragon are parked on the tarmac at Hong Kong International Airport, Hong Kong, China, Oct. 24, 2020. REUTERS / Tyrone Siu
By Jamie Freed
(Reuters) – Hong Kong-based Cathay Pacific Airways (OTC 🙂 Ltd expects to reduce its cash use to less than HK $ 1 billion (US $ 128.84 million) per month in the second half of the year, the chief financial officer said.
The airline had burned up to HK $ 1.9 billion in cash per month in the first half of the year due to crew quarantine restrictions, but that will decrease in the second half as the rules on vaccinated crews are relaxed and capacity increased, said CFO Rebecca Sharpe at an analyst briefing on Friday.
An invitation-only webcast of the briefing was released on Saturday evening.
Cathay has only operated 8% of its usual passenger capacity while passenger numbers have declined by more than 99% due to international border restrictions.
"The dramatic impact of COVID-19 on passengers to Hong Kong has not changed much in the past few months," Sharpe said.
By August, the company is hoping to increase capacity to 20% pre-COVID levels as Chinese students return to study in the United States and the UK, and that could climb to 30% in the fourth quarter if travel restrictions to Singapore and mainland China are lifted slacking off, says Cathay Chief Customer and Commercial Officer Ronald Lam said.
Cathay said earlier this month that losses in the first half of the year will be "slightly" lower than last year due to cost-cutting measures and strong demand for cargo flights.
Cathay's monthly cash burn value is slightly higher than the current value of S $ 100 million ($ 74.51 million) to $ 150 million rival Singapore Airlines (OTC 🙂 Ltd last month has reported.
Both airlines lack domestic markets and have relied on cargo traffic for most of their revenue since the pandemic began.
Cathay said 89 of the 239 aircraft in its fleet are in long-term storage in Australia and Spain. The airline has HK $ 32.8 billion in liquidity and will consider raising additional funds if it can do so at a reasonable cost, Sharpe said.
($ 1 = 7.7615 Hong Kong dollars)
($ 1 = 1.3421 Singapore dollars)
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