Cathay Pacific Airways : July 2020 Traffic Figures

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CATHAY PACIFIC AIRWAYS LIMITED

國泰航空有限公司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 293)

July 2020 Traffic Figures

The appended press release contains combined traffic figures for July 2020 for Cathay Pacific Airways Limited ("Cathay Pacific") and its wholly owned subsidiary, Hong Kong Dragon Airlines Limited ("Cathay Dragon"). The information in the press release may be price sensitive. This announcement containing the press release is accordingly being issued pursuant to Part XIVA of the Securities and Futures Ordinance. The information in the press release has been prepared on the basis of internal management records. It has not been audited or reviewed by external auditors.

This announcement is issued by Cathay Pacific pursuant to Part XIVA of the Securities and Futures Ordinance.

The information in this announcement has been prepared on the basis of internal management records. It has not been audited or reviewed by external auditors.

Investors are advised to exercise caution in dealing in shares of Cathay Pacific.

As at the date of this announcement, the Directors of Cathay Pacific are:

Executive Directors: Patrick Healy (Chairman), Gregory Hughes, Ronald Lam, Martin Murray, Augustus Tang;

Non-Executive Directors: Cai Jianjiang, Michelle Low, Song Zhiyong, Merlin Swire, Samuel Swire, Xiao Feng, Zhang Zhuo Ping, Zhao Xiaohang;

Independent Non-Executive Directors: Bernard Chan, John Harrison, Robert Milton and Andrew Tung.

By Order of the Board

Cathay Pacific Airways Limited

Paul Chow

Company Secretary

Hong Kong, 14th August 2020

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14 August 2020

FOR IMMEDIATE RELEASE

CATHAY PACIFIC RELEASES COMBINED TRAFFIC FIGURES

FOR JULY 2020

The Cathay Pacific Group today released its combined traffic figures for July 2020 that reflected the airlines' continued substantial capacity reductions in response to significantly reduced demand as well as travel restrictions and quarantine requirements in place in Hong Kong and other markets amid the ongoing global COVID-19 pandemic.

Cathay Pacific and Cathay Dragon carried a total of 42,984 passengers last month, a decrease of 98.7% compared to July 2019. The month's revenue passenger kilometres (RPKs) fell 98.1% year-on-year. Passenger load factor dropped by 62.6 percentage points to 23.4%, while capacity, measured in available seat kilometres (ASKs), decreased by 92.9%. In the first seven months of 2020, the number of passengers carried dropped by 79.4% against a 69.9% decrease in capacity and a 76.6% decrease in RPKs, as compared to the same period for 2019.

The two airlines carried 102,129 tonnes of cargo and mail last month, a decrease of 39.8% compared to July 2019. The month's revenue freight tonne kilometres (RFTKs) fell 33.3% year-on-year. The cargo and mail load factor increased by 12.7 percentage points to 75.8%, while capacity, measured in available freight tonne kilometres (AFTKs), was down by 44.5%. In the first seven months of 2020, the tonnage fell by 33.1% against a 33% drop in capacity and a 25.9% decrease in RFTKs, as compared to the same period for 2019.

Passenger

Cathay Pacific Group Chief Customer and Commercial Officer Ronald Lam said: "Passenger volume showed signs of slight improvement in the beginning of July, fuelled by a boost in the number of transit passengers via Hong Kong. We increased our passenger flights by a slight amount to approximately 7% of the normal capacity, up from about 4% in June, and gradually resumed some services to Chengdu, Xiamen, Frankfurt and Toronto.

"However, demand tapered down towards the end of the month as new waves of COVID-19 cases arose in numerous countries. As a result, passenger volume increased at a lower rate than capacity for July, and load factor further dipped to 23.4%. There were a few services that performed better than expected comparatively, notably Xiamen.

Cargo

"Cargo continues to be the better performer of the business. Tonnage improved month-on-month by approximately 10%, though this was still significantly down from last year's levels due to the significant reduction in cargo capacity provided by belly

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space on our passenger flights. Load factor remained high at 75.8%. Certain markets performed particularly well, notably the Indian subcontinent, which recorded a noticeable uptick as local lockdown measures were eased. We also saw reasonably strong month-end rushes for airfreight demand in Hong Kong and the Chinese mainland.

"Further to our existing efforts to increase available cargo capacity, since early July we have begun operating cargo-only passenger flights using select converted Boeing 777-300ER aircraft that have had some of the seats from the Economy Class cabin removed. This has enabled us to load shipments such as personal protective equipment (PPE) and garments in the passenger cabins inside fire-retardant cargo bags."

Outlook

"The global aviation sector continues to face major headwinds as a result of the COVID-19 pandemic and the associated travel restrictions that have been implemented. The International Air Transport Association (IATA) has now adjusted its forecast for when international passenger demand will return to pre-pandemic levels to 2024, one year later than its previous estimate.

"As new waves of COVID-19 cases have emerged in Hong Kong and elsewhere, we have adjusted our passenger flights for August to approximately 8% of the normal capacity, which remains subject to the potential further relaxation or tightening of government health measures. We expect that our airlines will operate a similar level of passenger flight capacity in September.

"Meanwhile, we welcome the resumption of transit services via Hong Kong International Airport for passengers from the Chinese mainland, which becomes effective tomorrow. This will help enhance our passenger volume via the Hong Kong hub, and offer essential connections from the Chinese mainland to different parts of the world.

"In addition to the COVID-19 pandemic, we have to contend with a looming global recession and geopolitical tensions, which are expected to have a negative impact on both air travel and cargo demand. It is obvious that there will be no return to normal demand conditions any time soon.

"Our recapitalisation, which was completed earlier this week, provides us with a firm platform from which to move forward with our comprehensive review of our operations, and we will be making our recommendations to the board by the fourth quarter of this year on the optimal size and shape of the business to be competitive in the new normal of our industry."

The full July figures are on the next page.

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CATHAY PACIFIC /			JUL	% Change	Cumulative	%
CATHAY DRAGON						Change
COMBINED TRAFFIC
			2020	VS JUL 2019	JUL 2020	YTD
RPK (000)
- Chinese mainland			6,540	-99.2%	764,179	-85.8%
- North East Asia			7,056	-99.5%	2,014,177	-79.6%
- South East Asia			25,049	-98.4%	2,333,255	-77.8%
- South Asia, Middle East	&		-	-100.0%	1,449,874	-76.6%
Africa
- South West Pacific			28,337	-97.8%	3,130,659	-66.4%
- North America			128,526	-96.4%	5,404,830	-75.4%
- Europe			47,419	-98.4%	3,814,012	-78.1%
RPK Total (000)			242,927	-98.1%	18,910,986	-76.6%
Passengers carried			42,984	-98.7%	4,432,076	-79.4%
Cargo and mail revenue tonne		634,779	-33.3%	4,763,894	-25.9%
km (000)
Cargo and mail carried (000kg)		102,129	-39.8%	768,654	-33.1%
Number of flights			1,140	-84.1%	16,852	-65.0%
CATHAY PACIFIC /			JUL	% Change	Cumulative	%
CATHAY DRAGON						Change
COMBINED CAPACITY
			2020	VS JUL 2019	JUL 2020	YTD
ASK (000)
- Chinese mainland			32,115	-96.9%	1,276,699	-81.4%
- North East Asia			32,779	-98.2%	3,002,807	-75.2%
- South East Asia			105,690	-94.3%	3,773,626	-69.9%
- South Asia, Middle East	&		-	-100.0%	2,278,996	-69.1%
Africa
- South West Pacific			107,968	-92.9%	4,493,958	-58.8%
- North America			562,502	-86.3%	8,202,016	-68.0%
- Europe			195,200	-94.0%	5,740,113	-71.3%
ASK Total (000)			1,036,254	-92.9%	28,768,215	-69.9%
Passenger load factor			23.4%	-62.6pt	65.7%	-18.8pt
Available cargo/mail tonne km		837,080	-44.5%	6,795,225	-33.0%
(000)
Cargo and mail load factor			75.8%	12.7pt	70.1%	6.7pt
ATK (000)			935,735	-67.7%	9,530,484	-50.4%
Media Contact:
Email:[e-mail]	Tel: [phone]

Cathay Pacific website: www.cathaypacific.com

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Glossary

Terms:

Available seat kilometres ("ASK")

Passenger seat capacity, measured in seats available for the carriage of passengers on each sector multiplied by the sector distance.

Available tonne kilometres ("ATK")

Overall capacity measured in tonnes available for the carriage of passengers, excess baggage, cargo and mail on each sector multiplied by the sector distance.

Available cargo/mail tonne kilometres

Cargo capacity measured in tonnes available for the carriage of cargo and mail on each sector multiplied by the sector distance.

Revenue passenger kilometres ("RPK")

Number of passengers carried on each sector multiplied by the sector distance.

Cargo and Mail revenue tonne kilometres

Traffic volume, measured in load tonnes from the carriage of cargo and mail on each sector multiplied by the sector distance.

Ratio:

Revenue passenger kilometres/

Cargo and mail revenue tonne kilometres

Passenger/Cargo and mail load factor = ----------------------------------------------------

Available seat kilometres/

Available cargo and mail tonne kilometres

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