Cathay Pacific 2006 Annual Report Download - page 25

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Hong Kong Aircraft Engineering Company Limited
(“HAECO”)
• Cathay Pacific holds a 27.5% interest in HAECO
and a direct 9.0% holding in HAECO’s subsidiary
Taikoo (Xiamen) Aircraft Engineering Company
Limited (“TAECO”). The HAECO group provides a
range of aviation maintenance and repair services.
Its most substantial operations are aircraft
maintenance and modification work in Hong Kong
and Xiamen, and Rolls Royce engine overhaul work
performed by jointly controlled companies Hong
Kong Aero Engine Services Limited (“HAESL”) and
Singapore Aero Engine Services Limited (“SAESL”).
• HAECO’s profit increased by 37.0% to HK$846.8
million for the year due to capacity expansion and
continuing strong demand for its services. The
majority of the growth was due to strong demand
for heavy maintenance in the hangars of both
HAECO and TAECO. There was also good growth in
engine overhaul work at HAESL and SAESL.
• The HAECO group is expanding rapidly. Its second
hangar at HKIA was opened in December 2006
and a third hangar is planned to open in early 2009.
TAECO is constructing two more hangars in
Xiamen – one of which is scheduled to open in
mid-2007 and the other in early 2009. A new joint
venture, in which Cathay Pacific has a direct 9.9%
stake, has been formed to overhaul landing gear
in Xiamen. Furthermore, HAESL is building an
extension to its engine build shop which is due to
open in early 2008.
• Rapid growth has required a high level of
recruitment with total staff numbers increasing by
1,935 to 10,118 during the year. Further growth is
planned in 2007 to fully staff the new facilities.
Hong Kong International Airport Services Limited
(“HIAS”)
• Following the acquisition of Dragonair HIAS became
a wholly owned subsidiary. The company provides
airport ground handling services in Hong Kong to
Dragonair and other airlines.
• The company handled 34,055 flights in 2006,
representing a 13.4% increase over 2005.
• HIAS recorded a satisfactory performance for
the year.
Taxation
• Tax charges increased by HK$282 million to HK$782
million reflecting increased profits and under
provisions for prior years.
Dividends
• Dividends paid and proposed for the year are
HK$3,304 million representing a dividend cover of
1.2 times.
• Dividends per share increased from HK¢48 to
HK¢84.
Assets
• Total assets as at 31st December 2006 were
HK$103,090 million.
• During the year, additions to fixed assets were
HK$5,272 million, comprising HK$5,075 million for
aircraft and related equipment and HK$197 million
for other equipment.
23
Cathay Pacific Airways Limited Annual Report 2006
Financial Review