Business / Cathay Pacific Financial Report

Cathay Pacific Financial Report

Autor:  andrew  18 September 2012
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Words: 8951   |   Pages: 36
Views: 739

TABLE OF CONTENTS

EXECUTIVE SUMMARY 3

INDUSTRY ANAYLSIS 4

MACRO ENVIRONMENT - PESTLE 6

Political 6

Economic 6

Social 7

Technological 8

Legal 9

Environmental 9

PORTER'S FIVE FORCES 10

Rivalry Among Existing Competitors 10

Threat of New Entrants 11

Bargaining Power of Buyers 11

Threat of Substitutes 11

Bargaining Power of Suppliers 12

SWOT 13

HORIZONTAL/VERTICAL ANALYSIS 14

RATIO ANALYSIS 16

TREND ANALYSIS 20

SUSTAINABLE GROWTH RATE 24

RECOMMENDATIONS 25

BIBLIOGRAPHY 26

APPENDIX 28

APPENDIX 1: ADDITIONAL INDUSTRY INFORMATION 29

APPENDIX 2: ADDITIONAL SOURCES 30

APPENDIX 3: ADDITIONAL MACRO DETAILS 31

APPENDIX 4: DEFINITIONS OF RATIOS & CALCULATIONS 35

APPENDIX 5: SWOT DETAILS 42

EXECUTIVE SUMMARY

INDUSTRY ANAYLSIS

The airline industry is incredibly complex with many external factors influencing an airline's competitiveness in their chosen markets. The airline industry and likewise the major airline carriers are divided into two segments, passenger and cargo. Airlines offering passenger travel are further divided either as a full-service or low cost carrier (LLC), then further segregated geographically through their routes and regions.

Over the last decade the industry has sustained significant losses collecting $4.3tn in revenue and managed a profit of just $47bn, resulting in a 1% (Figure 1) return. For period alignment with our analysis, figures for 2010, the industry faired a little better returning 3.2%, $18bn from collective revenue of 55%, $4bn.

Figure 1; Source: IATA

Within Asia Pacific (APAC) however, the airlines since 2007 have on average been more profitable than the US and European airlines. This can be seen in strategic moves such as Cathay Pacific with a combination of total improvement on quality, new fleet investment and new cargo joint ventures with Air China to gain new cargo routes, like the Yangtze River Delta Region.

Aside from 2009, APAC airlines has had a growth trend (Figure 2) and even rebounding stronger post Global Financi...



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