Cathay to pay deferred dividend of $1.5b to HK government
The airline said it has been operating cash generative so far in 2023.
The Cathay Group announced that it will pay the Hong Kong government its deferred dividend of $1.5b on 30 June amidst a healthy financial position.
" We feel confident that our journey of rebuilding Cathay for Hong Kong is on the right track, and now is the appropriate time to begin repaying the support that the HKSAR Government has shown us," Chief Executive Officer Ronald Lam said.
Lam added that the airline has been operating cash generative in 2022 and has continued to do so, so far in 2023.
In a bourse filing, the group said the payment to the government will bring its "deferred dividend payments up to date."
Moving forward, the group intends to "pay all future preference shares dividends as they fall due, and to redeem the preference shares in due course."
Meanwhile, Cathay also announced that it no longer needs to utilise the $7.8b bridge loan facility extended by the government to them, which will expire on 8 June.
"The preference shares and bridge loan facility were an investment by the HKSAR Government to support the Cathay Group and the Hong Kong international aviation hub through the COVID-19 crisis. The overall $39b recapitalisation in June 2020 comprised three tranches," the group said.