Cathay Pacific Airways on Wednesday reported its first full-year loss since the 2008 global financial crisis, dragged down by overcapacity, a strong Hong Kong dollar and mounting competition from mainland Chinese carriers.
Shares of Hong Kong's flag carrier fell almost 5 percent after the news. Cathay had warned its results for the second half of 2016 would be weak as it battles falling demand for premium class seats on long-haul routes. It now expects the outlook to remain challenging in 2017 as the headwinds continue.
Acknowledging the competitive landscape, Cathay recently undertook what was the biggest review of its business in two decades and said it would cut jobs and consider shifting some flights to its short-haul arm as part of a three year programme.
For 2016, the Hong Kong carrier posted a net loss of HK$575 million ($74.01 million), versus a profit of HK$6 billion a year ago. This is only the third time the company has posted a full-year loss since it was founded in 1946.