Cathay Pacific 2014 Annual Report Download - page 21

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ANNUAL REPORT 2014
19
Review of Operations Cargo Services Loyalty and
Reward Programme
In the first half of 2014, the Cathay Pacific Group’s cargo business was affected by high fuel
prices, fierce competition and continued weakness and over-capacity in the air cargo
market. After a prolonged period of weakness, cargo demand started to improve in the
summer of 2014 and was very strong in the fourth quarter, which is the peak period for
cargo. As a result, our full year performance improved. Cathay Pacific and Dragonair carried
1.7 million tonnes of cargo and mail in 2014, an increase of 12.0% compared to the previous
year. The cargo revenue of Cathay Pacific and Dragonair increased by 8.6% to HK$22,035
million. Yield decreased by 5.6% to HK$2.19 despite improved cargo demand in the second
half. The cargo and mail load factor increased by 2.5 percentage points to 64.3%. We
managed capacity in line with demand in the first half of 2014, but were able to operate an
almost full freighter schedule for most of the second half. Cargo capacity for the year
increased by 10.4%. The profitability of our cargo operations was improved by lower fuel
prices in the fourth quarter of 2014, but this was partially offset by fuel hedging losses.
0
10,000
5,000
15,000
20,000
25,000
30,000
2010 2011 2012 2013 2014
0
4,000
6,000
2,000
8,000
10,000
12,000
16,000
14,000
2010 2011 2012 2013 2014
Capacity – cargo and mail ATK
HK$ million
Turnover
Million tonne
kilometres
Available tonne kilometres (“ATK”), load factor and yield for Cathay Pacific and
Dragonair cargo services for 2014 were as follows:
ATK (million) Load factor (%) Yield
2014 2013 Change 2014 2013 Change Change
Cathay Pacific and Dragonair 15,630 14,162 +10.4% 64.3 61.8 +2.5%pt -5.6%