Cathay Pacific Airways, among Hong Kong’s most prominent businesses, warned Wednesday it is dealing with a “substantial loss” in the first half of this year because of the coronavirus outbreak after last year’s profit dropped amid anti-government protests.
The Chinese territory’s main airline canceled 90% of its flight capacity to the mainland China at the beginning of February after Beijing informed the public to avoid travel as part of attempts to contain the outbreak centered on the city of Wuhan.
“We expect to incur a substantial loss for the first half of 2020,” chairman Patrick Healy stated. “We expect our passenger business to be under severe pressure this year and that our cargo business will continue to face headwinds.”
2019 profit dropped 27.9% from the previous year to 1.7 billion Hong Kong dollars ($218 million), the airline stated. Revenue dropped 3.7% to 107 billion Hong Kong dollars ($13.8 billion).
2020 was expected to be very “challenging financially” after tourist arrivals in Hong Kong dropped amid protests that started in June over a proposed extradition law and expanded to include other issues, said Healy.
The situation has worsened by the major “negative impact” of coronavirus, Healy said.
Its cargo business also was damaged by a U.S.-Chinese tariff war that depressed trade.
The airline has asked its 27,000 workers to take three weeks of unpaid leave between March 1 and June 30.