Hong Kong’s flagship carrier Cathay Pacific Airways says it is aiming for a dividend payout ratio of 50 percent of net earnings and will continue to maintain a sustainable fuel cost hedging strategy.

“While we have resumed paying full-year dividends, we will pay dividends in the future based on the company’s operating conditions, with a target dividend payout ratio of 50 percent,” CPA Group Chairman Patrick Healy told a shareholders’ meeting on Wednesday.

Responding to some shareholders’ concerns about the airline’s fuel hedging strategy, Healy said: “We have always maintained a clear hedging policy and we believe the current strategy is in the best interest of the company.”

“The company will hedge an average of 25 percent of its fuel costs. In the future, we will continue to maintain a sustainable hedging strategy based on hedging contract prices and fuel consumption,” said Rebecca Sharpe, the carrier’s chief financial officer.

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Chief Executive Officer Ronald Lam Siu-por said CPA had restored passenger capacity to 80 percent of pre-pandemic levels in the first quarter of this year. “We are confident of attaining our target of restoring passenger capacity to 100 percent of pre-pandemic levels in the first quarter of 2025.”

Hong Kong Express -- a subsidiary of CPA -- has launched a new baggage policy and raised the number of fare options from two to four with immediate effect

“As supply and demand gradually normalize, air ticket prices have continued to fall year-on-year and we expect air fares to continue falling this year,” Lam said.

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Hong Kong Express -- a subsidiary of CPA -- has launched a new baggage policy and raised the number of fare options from two to four with immediate effect. Passengers paying the lowest fare can carry only one piece of baggage on board, with a maximum weight of seven kilograms. Passengers will have to pay more for check-in luggage which will be charged according to its weight, based on the category of 20kg and 32kg.

“As Hong Kong Express is a low-cost airline, we have to modify our policy based on the practices of other airline peer companies in Asia and customer needs. The relevant measures are meeting customers’ expectations of air ticket prices without checked baggage,” Lam said.

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CPA will adopt a dual-brand strategy to develop its passenger business, focusing on expanding destinations that Hong Kong passengers have not been able to fly directly to. Details will be announced in the second half of this year.

“We will continue to make new investments, including launching a new business class and a premium economy class, and improving VIP lounges and in-flight catering and entertainment services,” Lam said.