HK Express (UO, Hong Kong International) lost HKD73 million Hong Kong dollars (USD9.4 million) during the first half of 2024, primarily due to Pratt & Whitney engine issues and falling yields, according to Rebecca Sharpe, CFO of parent entity Cathay Group. Alongside HK Express, the group owns and operates Cathay Pacific and Cathay Cargo in addition to having stakes in Air Hong Kong and Air China.

In a half-yearly group results presentation on August 7, HK Express was described as having had a "challenging half" on generated revenues of just under HKD3.18 billion (USD407.2 million) and average passenger loads of 85%. As of the end of June, it was flying to 25 airports and its flight frequencies were 147% of 2019 levels. But this was not enough to get it into the black.

The loss "was due to a combination of two key factors," said Sharpe. "HK Express flies the A320N aircraft. That has the Pratt & Whitney geared turbofan engine on it, which has had several issues. We have a number of those aircraft on the ground while we wait for the engines to be repaired, and this impacts the capacity the airline can offer."

According to ch-aviation fleets data, HK Express operates 37 aircraft, including six A320-200s, ten A320-200Ns, thirteen A321-200s, and eight A321-200NX. Of that number, six A320-200Ns are currently on the ground.

Sharpe said the second key factor was the normalisation of yields. "As more regional capacity comes back, the competition brings the yields down," she said. "There have been a couple of different dimensions [impacting profit], but overall we're very confident in the long-term future of HK Express, and it will play a big part of our future growth story."

Speaking to outlets this week, Cathay Group CEO Ronald Lam said he expected the Pratt & Whitney issues to continue for a few more years and said the company had reached a financial settlement with the engine manufacturer. However, he did not disclose further details.

Cathay Group reported a half-yearly profit of HKD3.6 billion (USD462 million) and said it was paying its first interim dividend since 2019, which will cost the company around HKD1.3 billion (USD170 million). On the same day as it announced its latest numbers, Cathay Pacific placed a firm order for thirty A330-900Ns, with options for another 30. Deliveries are expected to begin in 2028.