Cathay Pacific is on the rise again. After a robust financial turnaround, the airline is implementing a capital reduction program. This includes redeeming and canceling preference shares and exercising options to order narrowbody Airbus aircraft. The announcements came along with the airline’s report of a first-half profit of HKD4.268 billion Hong Kong dollars (USD546 million) on August 9, 2023.
Cathay Pacific Group Chairman Patrick Healy is optimistic, saying the airline is now flying over 43,000 passengers per day. They’re on track to reach 70% pre-pandemic passenger flight capacity by the end of 2023, and 100% by the end of 2024.
Healy stated, “The first half of 2023 has been a positive period for the Cathay Group, as we worked to rebuild connectivity at the Hong Kong international aviation hub following the full reopening of borders in Hong Kong and in the Chinese Mainland. Our results for the first six months of 2023 demonstrate that we are on the right track. Further demonstrating this, the Group plans to buy back 50% of the preference shares before the end of 2023 at a redemption price of over HKD9.75 billion, and the remainder by the end of July 2024.”
Redeeming Preference Shares and Aircraft Orders
An August 8, 2023, filing with the Hong Kong Stock Exchange (HKEX) revealed Cathay Pacific’s plan to redeem all of the issued preference shares, which currently stand at 195,000,000. They plan to redeem the shares in two tranches of 97,500,000 at HKD100 (USD12.80) per preference share, with the first redemption finalizing before December 31, 2023, and the second by July 2024.
These preference shares were issued to the Hong Kong government in 2020 as part of a HKD39 billion (USD5 billion) rescue package. The Group plans to cancel the shares upon their redemption.
Additionally, Cathay Pacific announced that it will exercise a 2017 options agreement to buy up to thirty-two A320neo and A321neo aircraft. The carrier plans to exercise the purchase rights on or before September 30, 2023.
Fleet Updates and Future Plans
As of June 30, 2023, Cathay Pacific’s fleet included 183 aircraft, with various models and types. The airline took delivery of an additional A350-900 in July and expects more in the coming years. They also anticipate the first of twenty-one B777-9s to start delivering in 2025 “and beyond.”
Cathay’s current fleet plan reveals that several aircraft will return to their lessors in the coming years, including B777-300ERs and A330-300s.
With a strong financial comeback, new aircraft orders, and a clear vision for the future, Cathay Pacific is soaring high. The airline’s commitment to growth and customer satisfaction is evident in its actions, and passengers can look forward to enjoying the continued excellence in service and connectivity that Cathay Pacific offers.
Source: Ch-aviation
First love never dies. I fell in love with airplanes and aviation when I was a kid. My dream was to become a pilot, but destiny led me to another path: to be an aviation digital media content creator and a small business owner. My passion for aviation inspires me to bring you quality content through my website and social accounts. Aviation is indeed in my blood and blog!
