Cathay Pacific continues to be plagued by financial woes with the 71-year-old Hong Kong carrier reporting its first annual back-to-back loss in the company’s history.

The carrier’s net loss for 2017 came to more than HK$1.25 billion (US$159 million), over double the annual loss of HK$575 million that it posted in 2016.

However, there do appear to be some signs of improvement for Asia’s biggest carrier. Following a significant HK$2.05 billion (US$261 million) loss in the first half of 2017, the carrier was able to report an attributable profit of HK$792 million (US$100 million) in the second half of the year.

This was helped by a 19.1 per cent increase in its cargo revenue, a weaker US dollar and improved premium class passenger demand.

In a release issued by Cathay Pacific, the airline noted that many of the factors that affected its profitability remained unchanged from the previous year, however losses from its past fuel hedging were reduced.

“Overcapacity in passenger markets led to intense competition with other airlines and continued pressure on yields on many of our key routes,” the airline said in the release.

Cathay Pacific did identify positive results from its three-year transformation programme that it launched in the first half of 2017 following its previous losses, however its passenger business still appears to be slipping.

Despite an increase in capacity of 2.8 per cent – affected by the introduction of new routes and higher frequencies on existing services – load factor dropped 0.1 percentage points and the airline’s passenger revenue dropped by 0.8 per cent compared to 2016, to HK$66.4 billion (US$8.4 billion).

A number of one-off factors were also identified as having adversely affected the airline, including a €57.12 million (HK$498 million/US$70.7 million) fine from the European Commission in March after it ruled Cathay Pacific and a number of other international air cargo carriers had agreed to cargo surcharge levels prior to 2007. Cathay Pacific has since filed an application to annul the decision.

“Our priorities for 2018 are our transformation programme, changing the way that we work so as to better contain costs which will strengthen our passenger business further,” said chairman Cathay Pacific John Slosar. “We are confident of a successful outcome from these efforts. We also look to benefit from a slowing of the decline in passenger yields as global economic conditions improve.

“We are improving our competitive position by expanding our route network, increasing frequencies on our most popular routes and buying more fuel-efficient aircraft. We have improved productivity and efficiency and at the same time we are improving our already high customer service standards.”

Cathay Pacific is set to take delivery of its first Airbus A350-1000 aircraft this year ahead of its debut on September 15 on a new route to Washington DC, which will be the longest route in the airline’s network.

The airline also plans to launch a new seasonal non-stop service to Cape Town on November 13, 2018, using its existing A350-900.