Cathay Pacific is accumulating huge losses as almost all of its flights remain suspended because of COVID-19, and the Hong-Kong-based carrier sees little prospect of improvement in the near term.

The group reported an unaudited loss of HK$4.5 billion ($580 million) for the calendar year through the end of April, covering the parent carrier and its Cathay Dragon subsidiary. “The financial outlook continues to be very bleak for the coming few months at least,” Cathay Pacific chief customer and commercial officer Ronald Lam said.

Cathay operated a skeleton network to just 14 destinations in April, and projects it will have an average of only 500 passengers a day in May. It will “continue to operate a minimal schedule over the next two months,” Lam said.  Most of its traffic is inbound, particularly from North America and the UK.

Business and leisure demand “will remain severely impacted for the foreseeable future,” Lam said. The airline is planning to operate 5% of its scheduled capacity in June compared to 3% in May, assuming the government relaxes some restrictions. However, “overall, we do not anticipate we will see a meaningful recovery for an extended period,” Lam said.

The airline’s passenger traffic dropped 99.3% year-on-year in April as capacity was reduced 97.3%. For the four months through the end of April, passengers were down 59.1% on a 49.9% capacity decline.

Cargo is also down significantly, although not to the same extent as passenger traffic. Cargo traffic dropped by 37.3% year-on-year in April, with capacity down 44.1%. This was mainly due to the reduction in belly cargo capacity following the loss of passenger flights.

While many types of cargo have declined, Cathay has been carrying “significant quantities” of medical supplies from Hong Kong and mainland China, Lam said. The airline has prioritized capacity on the highest-demand routes such as those to the Americas, Australia and Europe.

Cathay has increased the utilization of its freighters and chartered more freighter flights using all-cargo subsidiary Air Hong Kong. 

The airline also operated 500 cargo-only return flights using passenger aircraft in April, double the number flown in March. At the end of April, it started using the cabins of Boeing 777 passenger aircraft to carry more cargo.