Cathay Pacific 1999 Annual Report Download - page 13

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Review of Operations
17CATHAY PACIFIC AIRWAYS LIMITED ANNUAL REPORT 1999
•In 1999, the company completed its A320 fleet renewal by replacing these aircraft with new A320 and A321
aircraft powered by International Aero A5 engines.
•Dragonair joined the Asia Miles frequent-flyer programme in September 1999.
•Dragonair is constructing its own headquarters building at Chek Lap Kok, Dragonair House, which is
expected to be completed by June 2000.
•Demand for air services between Hong Kong and Mainland China is expected to grow in line with the
development of China’s economy.
•The company reported a similar profit to the previous year. 1999 was a difficult year but management
remains optimistic about the future of the airline.
Hong Kong Aircraft Engineering Company Limited (“HAECO”)
•HAECO, in which Cathay Pacific holds a 25% interest, provides aircraft maintenance and overhaul services
at Hong Kong International Airport.
•Profit after tax for the year was HK$59 million, 60% lower than that of the previous year.
•Line maintenance revenue was under severe pressure in 1999, as a result of the increase in competition at
Hong Kong International Airport. The volume of heavy maintenance work remained at a similar level as last
year with hangar facilities being well-utilised during the year.
•Taikoo (Xiamen) Aircraft Engineering Company Limited (TAECO), 42% owned by HAECO and 9% by
Cathay Pacific, had a successful year. The construction of a second hangar was completed in April 1999,
thus doubling the airframe heavy maintenance capacity.
•Hong Kong Aero Engine Services Limited (HAESL), HAECO’s joint venture with Rolls-Royce plc and
SIA Engineering Pte Limited, also had a satisfactory year.