Cathay Pacific hit by massive $6.45b fuel hedging loss in 2017

The airline deep dives into the red after posting its fourth straight year of deficits.

Bloomberg reports that Cathay Pacific is struggling to take off as it reports its fourth consecutive year of deficits amidst massive fuel-hedging loses worth $6.45b in 2017 with analysts expecting a turnaround by 2019.

Even though the airline has reduced the proportion of fuel it hedges, the effects still weigh on the company’s financials as the futures contracts were locked in years ago. 

To add to the airline’s headaches, Cathay has been largely unsuccessful in reducing the hefty compensation packages of its pilots – which include housing allowances – and accounts for the company’s second largest cost component after fuel. 

Here’s more from Bloomberg:

Photo from Cathay Pacific