0293.HK - Cathay Pacific Airways Limited

HKSE - HKSE Delayed Price. Currency in HKD
10.120
-0.140 (-1.36%)
At close: 4:08PM HKT
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Previous Close10.260
Open10.320
Bid10.120 x 0
Ask10.160 x 0
Day's Range10.120 - 10.320
52 Week Range9.270 - 14.140
Volume4,448,644
Avg. Volume4,160,396
Market Cap39.81B
Beta (3Y Monthly)0.83
PE Ratio (TTM)16.98
EPS (TTM)0.596
Earnings DateN/A
Forward Dividend & Yield0.38 (3.75%)
Ex-Dividend Date2019-09-04
1y Target Est14.01
  • Hong Kong Exchange’s China Ties May Backfire in LSE Quest
    Bloomberg

    Hong Kong Exchange’s China Ties May Backfire in LSE Quest

    (Bloomberg) -- When Hong Kong Exchanges & Clearing Ltd. bought the London Metal Exchange in 2012, the access it offered to the Chinese market was a big plus.But with questions mounting over Beijing’s role in Hong Kong affairs, those ties now represent a threat to HKEX’s 29.6 billion-pound ($36.6 billion) bid for the London Stock Exchange Group Plc.It’s an unfamiliar position for the corporate leaders who have made their drama-free links to Beijing key to their international appeal. Amid the U.S. trade war and scrutiny over China’s role in Hong Kong’s social unrest, the connections are emerging as a commercial handicap. Further complicating HKEX Chief Executive Officer Charles Li’s audacious offer is the $27 billion deal LSE made in July for data provider Refinitiv. Scrapping that is a condition of HKEX’s bid.“LSE is at the center of Britain’s financial market,” said Cecelia Zhong, CEO of Guojin Resources Ltd. and a former HKEX executive. “As it is busy focusing on its own data deal right now, the last thing LSE wants to consider is foreign ownership, particularly a Chinese player to control it.”The Hong Kong government, which owns 6% of HKEX, appoints six out of the company’s 13 board members, and the city’s chief executive -- a person appointed by Beijing -- picks the company’s chairman. The structure means the exchange operator comes under a level of political oversight unusual among other developed market bourses.Other Hong Kong companies have faced similar challenges even before the protests exploded earlier this year into the biggest crisis in Hong Kong since the city’s return to China in 1997.Deals VetoedIn November, Australia rejected a A$13 billion ($9 billion) gas project bid by Hong Kong tycoon Victor Li’s CK Infrastructure Holdings Ltd., calling it contrary to national interest. The decision followed a torrent of criticism in Australia that Hong Kong companies were just as susceptible to Beijing’s influence as those on the mainland. U.S. regulators last year rejected a bid by a Chinese-linked consortium to take over the Chicago Stock Exchange, a deal that then-candidate Donald Trump blasted when it was announced in 2016.The unrest also put unwelcome pressure on Hong Kong companies, particularly Cathay Pacific Airways Ltd., which faced a heavy backlash from China in the wake of its employees joining protests.About a month ago, China’s civil aviation authority began clamping down on Cathay, prompting the carrier to fire staff and threaten to terminate workers for even supporting the demonstrations -- let alone participating in them. Both the airline’s chief executive officer and chairman have since announced their resignations.“What we’ve seen with the Cathay Pacific example is that there is, whether direct or indirect, influence and pressure on Hong Kong companies, which I think some hoped was not necessarily there,” said Fraser Howie, who has two decades of experience in China’s financial markets and co-wrote the 2010 book “Red Capitalism.”China told its biggest state-run firms to take control of Hong Kong companies, Reuters reported Friday, a move that could further fuel concern that the mainland is stepping up efforts to play a bigger role in the former British colony. ‘British Institution’In a call with reporters on Wednesday, Li was asked about fears over China’s influence, and referred to the LME takeover. He recalled comments at the time that the deal would amount to a Chinese takeover -- concerns that haven’t borne out, he said.“We do not have Chinese management at all in the London Metal Exchange,” he said. “If you walk onto the floor, you will see a quintessential British institution.”HKEX shares fell 3.5% in Hong Kong on Thursday, and rose 1.3% Friday. LSE is trading at about 14% below the offer price, highlighting skepticism that a deal will get done. A statement from the London bourse called Wednesday’s offer an “unsolicited, preliminary and highly conditional proposal.” LSE was set to spurn the offer, people familiar with the matter said.LSE’s effort to complete its purchase of Refinitiv, the business that used to be Thomson Reuters Corp.’s financial and risk unit, is a big reason why HKEX’s bid is unlikely to succeed, said Jonas Short, head of the Beijing office at Everbright Sun Hung Kai Securities. Likewise, LSE shareholders including Jupiter Asset Management and Aberdeen Standard Investments indicated they prefer the British bourse’s planned takeover of Refinitiv -- a strategic move to expand in data that HKEX wants to scrap.Commercial strategy notwithstanding, the British government has the power to scrap the deal on public-interest grounds. “The London Stock Exchange is a critically important part of the U.K. financial system, so as you would expect, the government and the regulators will be looking at the details closely,” said a spokesperson for the U.K. government on Wednesday.Not all acquisitions involve strategic assets. Victor Li’s CK Asset Holdings Ltd.’s agreed to pay 2.7 billion pounds ($3.3 billion) for Greene King Plc, which operates more than 2,700 British bars, restaurants and hotels.Still, Brock Silvers, managing director at Kaiyuan Capital, said the heightened scrutiny on Chinese entities won’t recede even after an end to the trade war, and it’s almost certain, he said, that HKEX will be viewed as a Chinese company.“An eventual deal would expose LSE to a variety of Chinese corporates and government entities, and some of those relationships could be highly problematic from political, compliance, or know-your-customer perspectives,” he said.(Adds details of Reuters report in 11th paragraph)\--With assistance from Alfred Liu, Lucille Liu and Benjamin Robertson.To contact Bloomberg News staff for this story: Kiuyan Wong in Hong Kong at kwong739@bloomberg.net;Evelyn Yu in Shanghai at yyu263@bloomberg.netTo contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, James Hertling, Sam MamudiFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Cathay Pacific freezes new hiring, to focus on cost cuts - memo
    Reuters

    Cathay Pacific freezes new hiring, to focus on cost cuts - memo

    Cathay Pacific Airways Ltd has put a freeze on new hiring, according to an internal memo seen by Reuters, as the airline battles a slump in demand from fliers avoiding Hong Kong amid massive anti-government protests in the city. In a memo to staff on Wednesday evening, new Chief Executive Augustus Tang said he had asked executives to examine spending and focus on cutting costs. The airline will also not replace departing employees in non-flying positions unless approved by a spending control committee, he said.

  • Cathay Pacific freezes new hiring, to focus on cost cuts: memo
    Reuters

    Cathay Pacific freezes new hiring, to focus on cost cuts: memo

    Cathay Pacific Airways Ltd has put a freeze on new hiring, according to an internal memo seen by Reuters, as the airline battles a slump in demand from fliers avoiding Hong Kong amid massive anti-government protests in the city. In a memo to staff on Wednesday evening, new Chief Executive Augustus Tang said he had asked executives to examine spending and focus on cutting costs. The airline will also not replace departing employees in non-flying positions unless approved by a spending control committee, he said.

  • Financial Times

    Cathay Pacific shares dip after passenger traffic drops in August

    Cathay Pacific shares slipped on Thursday after the airline reported a near 40 per cent slump in traffic into Hong Kong in August as tourists and business travellers avoided the disruption caused by anti-government protests in the city and as the airline faces pressure from Beijing. “August was an incredibly challenging month, both for Cathay Pacific and for Hong Kong,” Ronald Lam, the airline’s chief customer officer, said. Demand for flights to Hong Kong from mainland China were “severely hit”.

  • Benzinga

    Cathay Pacific Cargo Sector Takes Hit From Hong Kong Protests

    Hong Kong-based Cathay Pacific Airways (OTCMKTS: CPCAY), alongside its subsidiary Cathay Dragon, reported sinking air cargo numbers for August amid ongoing political unrest in its home city. Cathay Pacific hinted at tough times ahead during its most recent earnings call in early August. The call was before Hong Kong protests descended on the airport itself.

  • Reuters

    UPDATE 3-Hong Kong protesters hit pause in memory of Sept. 11

    Hong Kong activists called off protests on Wednesday in remembrance of the Sept. 11, 2001 attacks on the United States and denounced a Chinese state newspaper report that they were planning "massive terror" in the Chinese-ruled city. Hong Kong has been rocked by months of sometimes violent unrest, prompted by anger over planned legislation to allow extraditions to China, but broadening into calls for democracy and for Communist rulers in Beijing to leave the city alone. "Anti-government fanatics are planning massive terror attacks, including blowing up gas pipes, in Hong Kong on September 11," the Hong Kong edition of the China Daily said on its Facebook page, alongside a picture of the hijacked airliner attacks on the twin towers in New York.

  • Financial Times

    Hong Kong’s tycoons do not always serve the Communist party well

    According to two people familiar with the exchange, the Civil Aviation Administration of China told executives at Swire Pacific, the airline’s parent group, that their top managers at Cathay “are not patriots”. Last week the airline’s non-executive chairman, who famously said that he “wouldn’t dream of telling [Cathay staff] what they have to think about something”, was also replaced.

  • Cathay Pacific's Crisis Puts Focus on Air China’s Next Move
    Bloomberg

    Cathay Pacific's Crisis Puts Focus on Air China’s Next Move

    (Bloomberg) -- Sign up for Next China, a weekly email on where the nation stands now and where it's going next.China’s crackdown on Cathay Pacific Airways Ltd. has raised questions about the government’s insider at the carrier: Air China Ltd.State-run Air China has quietly owned almost 30% of Cathay for more than a decade, giving the national flag carrier a ringside view of the Hong Kong airline’s worldwide operations. Restrictions imposed on Cathay by China’s aviation regulator last month -- after some pilots and cabin crew supported pro-democracy demonstrations in Hong Kong -- have put a spotlight on Air China’s plans for its investment, and its role within the airline.Several options are open. It could gain more clout as Cathay’s new leadership bows to Beijing, or it could cut ties with a company that has fallen out of favor with investors and drawn the Chinese government’s ire. Either way, analysts say there’s no simple, risk-free path forward.Below are some of the arguments for Air China to raise, hold or fold.Buy MoreAn Air China-Cathay Pacific merger has long been speculated on, but recent weeks have shown where the power lies. Cathay has said it will comply with all of last month’s demands from China’s aviation regulator, its chief executive and chairman have both resigned, and staff have been ordered not to take part in illegal protests.“It’s a matter of time” before China takes over Cathay completely, and it’s in Air China’s interest to own more Cathay shares, said Shukor Yusof, founder of aviation consulting firm Endau Analytics. The Civil Aviation Administration of China could squeeze Cathay until it capitulates, he said.“From Air China’s perspective, Cathay is definitely a prize they would want to get hold of,” said Paul Yong, an analyst at DBS Bank Ltd. in Singapore.But Air China would need to find a seller. Swire Pacific Ltd. owns 45% of Cathay and Qatar Airways owns about 10%, so there are few freely traded Cathay shares available.“As a long-term shareholder in Cathay Pacific for over 70 years, Swire is firmly committed to the airline,” spokesman James Tong wrote in an email. “We have full confidence in its long-term prospects.”Air China representatives didn’t reply to emails seeking comment. The South China Morning Post reported Monday that Air China non-executive director Stanley Hui said the Chinese carrier isn’t interested in a takeover and has no desire to get involved in Cathay’s day-to-day operations.From a financial perspective, Cathay shares are relatively cheap. The stock has more than halved from a 2010 high and is down around 6% since mass protests kicked off in Hong Kong in early June. Cathay rose 0.4% to HK$10.46 at 10:28 a.m. in Hong Kong on Tuesday, still below the HK$12.88-a-share that Air China paid in 2009.Status QuoAir China’s stake in Cathay sits just shy of the 30% threshold that would trigger a takeover offer. But it may not need to own more to extract benefits from the company.“There are still things Air China can learn from Cathay Pacific, especially on the premium product side,” said DBS’s Yong.Air China and Cathay, which owns 18% of Air China, have said they plan to renew until the end of 2022 a collaborative agreement covering everything from catering and ground support to code sharing and aircraft leasing. The two companies also own a cargo business in mainland China.“It would make a lot of sense” for Cathay and Air China to be part of the same group and share knowledge of each other’s markets, said Torbjorn Karlsson, a partner specializing in aviation at Korn Ferry International in Singapore. Air China doesn’t need to own Cathay, he said. “Control and ownership is less relevant than the blend of experience, skills and leadership.”The Emergency ExitDumping Cathay stock would allow Air China to cut ties with a carrier in the government’s line of fire. China’s regulator threatened to bar Cathay from mainland airspace, state-owned companies have boycotted flights, and state-backed ICBC International released an unusually bearish report on the airline last month.But an exit would deprive Air China of leverage over Cathay, and may be the least likely course of action.“Why would they do that?” said Yusof at Endau Analytics. “They have a vested interest in seeing Cathay civilized, reformed and overhauled.”(Updates with Cathay’s stock price on Tuesday in the 11th paragraph.)To contact the reporters on this story: Angus Whitley in Sydney at awhitley1@bloomberg.net;Kyunghee Park in Singapore at kpark3@bloomberg.netTo contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Will DaviesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Air China has no plans to take over Cathay Pacific: media report
    Reuters

    Air China has no plans to take over Cathay Pacific: media report

    Air China Ltd has no plans to take over Hong Kong's Cathay Pacific Airways Ltd , an independent director of the state-owned Chinese carrier told the South China Morning Post newspaper. "Based on what I know, I wouldn't think that is anywhere on the agenda, no way," Air China non-executive director Stanley Hui told the newspaper when asked if the carrier, a 30% shareholder, might seek to buy Cathay outright. The Hong Kong airline has become the biggest corporate casualty of anti-government protests after China demanded it suspend staff involved in, or who support, demonstrations that have plunged the former British colony into a political crisis.

  • Cathay Pacific Chairman Resigns Weeks After CEO Steps Down
    Bloomberg

    Cathay Pacific Chairman Resigns Weeks After CEO Steps Down

    (Bloomberg) -- Merlin Swire, the scion of the U.K. family that controls Cathay Pacific Airways Ltd., is running out of concessions to offer after his employees angered China by joining the anti-Beijing protests in Hong Kong.Less than a month ago, China’s civil aviation authority began clamping down on Hong Kong’s flag carrier, prompting Swire to swiftly fly to Beijing to try to smooth things over with officials. Since then, Cathay has fired staff and threatened to terminate workers for even supporting the demonstrations -- let alone participate in them. The airline’s chief executive officer quit and on Wednesday, Chairman John Slosar announced his resignation.Swire’s response to the crisis illustrates the lengths companies will go to avoid falling afoul of the Chinese government. The cautionary tale, involving an airline whose business would be crippled if it lost access to China, has prompted multinational companies such as KPMG and PwC to take steps to avoid giving the appearance of siding against the mainland.“They’re using Cathay as an example on how far they can go, how far economically and financially strangle you,” said Shukor Yusof, founder of aviation consultant Endau Analytics. “I don’t know whether China will see this as far enough.”Cathay stock fell as much as 3.9%, before trading down 2.6% at HK$10.42 at 1 p.m. in Hong Kong. That trimmed the airline’s market value to HK$41 billion ($5.2 billion).Slosar, 63, will be replaced by Patrick Healy, a 31-year veteran of Cathay’s parent Swire Group who has spent years in China.Cathay’s troubles began emerging after employees took part in a general strike last month that caused a shutdown of Hong Kong’s airport, canceling hundreds of flights from the carrier’s hub. Chinese authorities soon threatened to ban Cathay flights from flying into mainland airspace and imposed a swathe of demands. Then some Chinese state-owned firms boycotted the airline.Cathay and Swire have since cracked down on employees, warning workers multiple times not to participate in or support any illegal protests.Though it’s unclear how big the financial toll will be, the airline has warned that it expects “significant impact” on its revenue from August and beyond as the protests weigh on travel demand. Both business and leisure travel into Hong Kong has “weakened substantially” and traffic from the city has started to soften, especially on short-haul routes to China and South Korea, Cathay has said.‘Company in Crisis’Zhao Dongchen, the analyst at state-backed ICBC International who last month issued his inaugural report on Cathay with a “strong sell,” said the resignations may not be enough to turn around the carrier.“Management changes are generally good for a company in crisis,” he said in response to Bloomberg queries. “But I think Cathay still has a lot to do to turn its current negative public perception.“Slosar, also a Swire veteran, ran Cathay as CEO from 2011 before becoming its chairman in 2014. As CEO, he faced challenges including intensifying competition, rising fuel costs and union demands -- yet succeeded in keeping profitability and maintaining revenue growth.‘They’re All Adults’As chairman when the demonstrations in Hong Kong intensified, Slosar seemed reluctant to rein in Cathay’s workforce.“We certainly wouldn’t dream of telling them what they have to think about something,” Slosar said at an earnings briefing on Aug. 7, days after Cathay pilot and flight-crew unions took part in a general strike coordinated by protesters. “They’re all adults, they’re all service professionals. We respect them greatly.”Slosar’s replacement, 53-year-old Healy, has worked his way up at Swire’s various businesses in Hong Kong, China and Germany, and is currently heading Swire’s Coca-Cola operations. He graduated from St. John’s College, Cambridge University, in July 1988 with a Bachelor’s degree in modern languages.Healy and the new CEO, Augustus Tang, now have a delicate task of continuing to placate China, an increasingly important market for the seven-decade-old airline. The new leaders also need to minimize the fallout from staff, customers and investors as the unrest in its home base continues to simmer.After former CEO Rupert Hogg‘s departure, the Global Times, a newspaper published by China’s Communist Party, said the resignation may not be enough to atone for Cathay’s “lukewarm attitude” to dealing with its “radical” employees. Pilots and flight attendants from the airline took part in strikes and demonstrations related to the protest, which has morphed from opposing an extradition bill into a mass repudiation of China’s hold over the territory it took back in 1997.There are signs that investors are betting Cathay will be able to soothe Beijing. After tumbling to a decade low last month in the depths of the crisis, the shares have since rebounded as the fourth-best-performer among 64 listed global airlines tracked by Bloomberg.\--With assistance from Evelyn Yu and Angus Whitley.To contact the reporter on this story: Kyunghee Park in Singapore at kpark3@bloomberg.netTo contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Ville HeiskanenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Cathay shares fall nearly 4% after chairman resigns
    Reuters

    Cathay shares fall nearly 4% after chairman resigns

    Shares in Cathay Pacific Airways Ltd fell nearly 4% in early trade on Thursday following the resignation of its chairman after the market closed on the previous day. The departure of John Slosar was announced less than three weeks after mounting Chinese regulatory scrutiny led to the shock exit of its chief executive, Rupert Hogg. Cathay shares had closed 7.2% higher on Wednesday as the Hong Kong market was lifted by reports of the withdrawal of a controversial extradition bill, which was officially announced after the market closed.

  • Investing.com

    Asian Markets Rise as HK Scraps Extradition Bill; China-U.S. Talks Resume in Oct

    Investing.com – Asian markets rose in morning trade on Thursday. The Hang Seng Index gained 0.5% after Hong Kong’s leader Carrie Lam said the government is fully withdrawing an extradition bill that sparked historic unrest in the city.

  • Cathay Chairman Slosar resigns weeks after CEO left, deepening reshuffle
    Reuters

    Cathay Chairman Slosar resigns weeks after CEO left, deepening reshuffle

    Hong Kong's Cathay Pacific Airways shook up its top ranks further as Chairman John Slosar resigned on Wednesday, less than three weeks after mounting Chinese regulatory scrutiny led to the shock departure of its chief executive. The airline has become the biggest corporate casualty of anti-government protests after China demanded it suspend staff involved in, or who support, demonstrations that have plunged the former British colony into a political crisis. Slosar, 63, will be replaced by Patrick Healy, a long-time executive at the airline's top shareholder and manager Swire Pacific Ltd , Cathay announced.

  • Reuters

    UPDATE 12-Hong Kong leader pulls extradition bill, but too little too late, say some

    Hong Kong leader Carrie Lam on Wednesday withdrew an extradition bill that triggered months of often violent protests so the Chinese-ruled city can move forward from a "highly vulnerable and dangerous" place and find solutions. The withdrawal needs the approval of the Legislative Council, which is not expected to oppose Lam. The bill would have allowed extraditions to mainland China where courts are controlled by the Communist Party.

  • Reuters

    REFILE-UPDATE 1-Hong Kong's Cathay Pacific warns against protest outside its premises

    Hong Kong carrier Cathay Pacific Airways warned against what it described as an illegal protest planned outside its offices on Wednesday and that it had zero tolerance for "violent activities" and any staff who took part. Cathay has been caught in the crosswinds between authorities in Beijing and anti-government protesters who have staged sometimes violent demonstrations since June that have grown to pose the city's biggest challenge since it returned to Chinese rule in 1997.

  • Cathay Pacific’s Crisis Puts Spotlight on Shareholder Air China
    Bloomberg

    Cathay Pacific’s Crisis Puts Spotlight on Shareholder Air China

    Sep.09 -- China’s crackdown on Cathay Pacific Airways Ltd. has raised a new question: could one of its top shareholders take over the airline completely? State-run Air China Ltd. already owns almost 30% of Cathay, leading some to speculate on a potential merger. Angus Whitley reports on "Bloomberg Markets: China Open."