Cathay Pacific 2003 Annual Report Download - page 13

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Cathay Pacific Airways Limited Annual Report 2003 11
Review of Operations
•Osaka and Singapore were added to Cathay
Pacific’s freighter network during the year.
•During the year, frequencies to Brussels,
Manchester, Milan and cities in the United
States increased as demand in these
markets grew.
•Cargo yield was maintained at HK$1.78 with
the dilutionary impact of additional lower
yield long haul services being offset by
favourable currencies.
•Cathay Pacific is to be the launch customer for
Boeing’s freighter conversion program for the
B747-400 passenger aircraft. The conversion
will be undertaken by Taikoo (Xiamen) Aircraft
Engineering Company Limited (“TAECO”) with
the first aircraft expected to be delivered in
December 2005 and another five by 2007.
AHK Air Hong Kong Limited
•In March, DHL International Limited (“DHL”)
acquired an additional 10% shareholding in
AHK from Cathay Pacific. DHL now has a 40%
interest in AHK.
•AHK continues to operate scheduled services
to Osaka and Seoul and charter flights for
Cathay Pacific using a B747-200 freighter.
•AHK commenced a four times weekly express
cargo service to Bangkok in March while a five
times weekly service to Singapore was started
in October.
•Capacity, due to the full year effect of the return
of two B747-200 freighters to Cathay Pacific,
fell by 69.9% over 2002 whilst the load factor
decreased by 12.2 percentage points.
•Yield increased due to the transfer of the
lower yielding European services to Cathay
Pacific in 2002.
•AHK recorded a satisfactory profit in 2003.
Review of affiliated businesses and
associated companies
Cathay Pacific Catering Services (H.K.)
Limited (“CPCS”)
•CPCS, a wholly owned subsidiary of
Cathay Pacific, is the principal flight kitchen in
Hong Kong.
•The company produced 13 million meals and
accounts for 72% of the airline catering
market in Hong Kong.
•The performance of the company was
seriously affected by the SARS outbreak in
March and stringent cost controls were
implemented. Recovery was seen in the
second half as passenger traffic picked up,
though pressure on meal prices continued.
Hong Kong Airport Services Limited
(“HAS”)
•HAS, in which Cathay Pacific holds a 70%
interest, is the largest franchised ramp
handling company at Hong Kong
International Airport.
•Services include aircraft loading, passenger
steps and air-bridge operation, baggage
handling, passenger and staff buses, aircraft
load control and cargo and mail delivery.
•The total number of flights handled in 2003
was lower than in the previous year due to
flight cancellations resulting from the SARS
outbreak.
•In the circumstances HAS reported a
satisfactory profit for the year.