Cathay Pacific Reports Strong Cargo Growth in 2024 Annual Results

Cathay Pacific has reported a solid 10.5% increase in total revenue for 2024, reaching HK$104.37 billion. The cargo segment played a key role in this growth, with cargo revenue rising by 8.3% to HK$24 billion. The volume of cargo carried surged by 10.9%, reaching 1.5 million tonnes, reflecting strong demand across various global markets.

The carrier expanded its cargo capacity, with available freight tonne kilometres (AFTK) increasing by 8.6%, while revenue freight tonne kilometres (RFTK) saw a more modest 5% growth. Despite a 2.1 percentage point decline in the cargo load factor to 59.9%, cargo yield improved by 2.9% to HK$2.82, indicating stable market pricing and strong demand across key trade lanes.

Cathay Cargo experienced substantial growth across various sectors, reflecting strong demand for air freight services. E-commerce shipments from the Chinese Mainland to long-haul destinations, particularly the Americas, saw a significant rise, driven by the global surge in online shopping. The airline also recorded strong export volumes of perishables and pharmaceuticals, especially from Europe to Hong Kong and other regional destinations, demonstrating its capability in handling specialized cargo.

The automotive sector also contributed to the airline’s cargo growth, with a notable increase in the transportation of automotive components. This was particularly evident in shipments from Japan and Germany to key manufacturing hubs in Southeast Asia. Additionally, technology products, including semiconductors and consumer electronics, remained a major segment of Cathay Cargo’s operations. These goods were primarily transported along major trade routes linking East Asia with North America and Europe.

Ronald Lam, Chief Executive Officer of Cathay Pacific highlighted Cathay Cargo’s performance, stating, “Our cargo performance was strong, thanks in part to the additional belly space provided by our increased passenger flights, which enabled us to carry more cargo.”

Stake dilution in Air China
In 2024, Cathay Pacific’s stake in Air China declined following an external share issuance. On December 10, Air China issued 855 million new A shares, reducing Cathay’s ownership from 15.87% to 15.09%. This resulted in a one-off non-cash gain of approximately HK$500 million. Separately, Air China Cargo’s listing on the Shenzhen Stock Exchange on December 30 led to a further reduction in Cathay’s interest from 23.99% to 21.36%. These were not strategic moves by Cathay Pacific but rather the outcome of Air China’s capital-raising actions.

Cathay Pacific reported a profit of HK$9.89 billion, marking a slight increase from HK$9.79 billion in 2023. Group revenue saw a 10.5% rise to HK$104.37 billion, driven by strong cargo performance, operational efficiencies, and network expansion.

Sustainability and future outlook
Cathay Pacific continued its push toward sustainability, particularly through its Corporate Sustainable Aviation Fuel (SAF) Programme. In 2024, 3,400 metric tonnes of SAF produced by EcoCeres were used on flights departing from Hong Kong International Airport. A new partnership with DB Schenker secured 878 metric tonnes of SAF, strengthening Cathay’s efforts to reduce carbon emissions in air cargo operations.

Ronald Lam emphasized the airline’s long-term investment strategy, stating, “Central to our future growth is our commitment to invest more than HK$100 billion coinciding with the Three-Runway System’s commencement.”

Looking ahead, the airline plans to expand its cargo fleet and freight capabilities in line with the commissioning of the Three-Runway System at Hong Kong International Airport. These developments are expected to bolster Cathay’s long-term position as a major air logistics player in Asia-Pacific.

This article was originally published in The STAT Trade Times