Cathay Pacific: March aviation fuel prices have doubled compared to the previous two months, and details on the fuel surcharge adjustment will be announced as soon as possible

Cathay Pacific (00293.HK) announced its 2025 performance, with CEO Lin Shaobo stating that the main impact of the Middle East tensions on the company is oil prices; the price of jet fuel in March doubled compared to the average levels in January and February. The company will announce details of the fuel surcharge increase as soon as possible. Regarding fuel hedging, CFO Shen Bijia mentioned that the hedging ratio was about 30% last year, with no plans to change this mechanism.

Customer and Business President Liu Kaishi indicated that the situation in the Middle East has led many travelers needing to transfer locally to reroute through Hong Kong or other Asian aviation hubs, driving an increase in demand for Cathay's long-haul flights, especially on European routes; coupled with the already high booking rates for these flights, supply has become tight, resulting in an increase in ticket prices.

The company previously announced the suspension of flights to Dubai and Riyadh until the end of this month. Liu Kaishi stated that the related capacity will be redirected to European routes, and larger aircraft will be used to meet the growing demand. The company still maintains its target of approximately 10% capacity growth for this year.

Last year, Hong Kong Express recorded a loss of nearly HKD 1 billion. Lin Shaobo explained that this was mainly affected by short-term factors, including a decrease in demand for the previously relied-upon Japan routes due to earthquake rumors, as well as the company adding 20 new destinations last year, which take time to mature and may not be immediately profitable. He stated that indicators such as flight utilization rates and cost-effectiveness reflect that the fundamentals of Hong Kong Express remain robust, thus he remains confident in the long-term development of this business, and has seen improvements in performance in the first two months of this year