Cathay Pacific 2005 Annual Report Download - page 21

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19
Cathay Pacific Airways Limited Annual Report 2005
Group interest cover
2001 2002 2003 2004 2005
HK$ million
Net finance charges
Operating profit
Times
Interest cover
0
1,000
2,000
3,000
4,000
5,000
6,000
0
3
6
9
12
15
18
Cathay Pacific: fuel hedging
US$ million
American
gallons in million
1Q06 2Q06 3Q06 4Q06 1Q07 2Q07
Deferred profit on fuel hedging
as at 31st December 2005
Volume hedged
0
2
4
6
8
10
0
20
40
60
80
100
• Staff costs increased due to an increase in average
staff numbers and backdated salary payments to
cabin crew.
• Inflight service and passenger expenses rose due
to a 13% increase in passenger numbers.
• Landing, parking and route expenses increased as a
result of additional flights.
• Fuel costs increased due to a 38% increase in the
average into plane fuel price to US$1.73 per
American gallon and an 11.2% increase in
consumption to 1,160 million American gallons.
• Aircraft maintenance increased as a result of the
fleet expansion.
• Aircraft depreciation and operating leases increased
due to the new aircraft deliveries.
• Net finance charges decreased due to lower
average net borrowings.
• Cathay Pacific’s cost per ATK increased from
HK$2.07 to HK$2.19 due to higher fuel prices.
Associates
• The share of profits from associates decreased by
9.7% to HK$269 million.
• HAECO reported a higher profit than 2004 and this
partially outweighed the lower profit from Dragonair
which was adversely affected by higher fuel costs.
Taxation
• Despite reduced profit, the tax charge of HK$500
million was HK$54 million higher than the previous
year as a result of both increased overseas
charges and deferred tax liabilities on accelerated
tax depreciation.
Financial Review