Cathay Pacific Airways Ltd offered an upbeat outlook, citing strong passenger demand this quarter after posting record first-half revenue and its biggest profit in 16 years, according to Bloomberg.  

The Hong Kong carrier said it was “cautiously optimistic” about travel demand through the rest of the year despite the conflict in the Middle East, and remains on track to reach its capacity growth target of around 10 percent.

Net income surged 71 percent to HK$6.2 billion ($790 million) in the six months ended June 30, the airline said Wednesday, its best result for the period since 2010. That came in at the mid-point of its guidance last month, and included a HK$1.4 billion gain on the continued dilution of its stake in Air China Ltd and shrinking losses at budget unit HK Express.

Revenue jumped 25 percent to HK$68.1 billion, beating analyst estimates, as a surge in passenger numbers from travelers flying through Asia to avoid the Middle East, strong AI-related cargo demand, and higher fuel charges bumped up its top line performance.

Fuel costs — Cathay’s biggest expense — climbed almost 59 percent in the half. However, that was mitigated by an HK$878 million gain on fuel hedging and its gross fuel expense rose HK$9.7 billion, compared to the HK$13.7 billion jump in revenue.

Cathay’s profit jump enabled it to raise its interim dividend 30 percent to 26 Hong Kong cents per share.

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The airline’s shares were 1.0 percent higher in early afternoon trading Wednesday in Hong Kong. The stock is up 17 percent this year.

The Hong Kong airline group’s flagship carrier, Cathay Pacific, picked up 17.4 percent more passengers in the year through June, its traffic figures show.

Cathay’s performance stands out among regional rivals. Singapore Airlines Ltd last week reported it swung to its first quarterly loss in more than four years as fuel costs, before hedging benefits, outstripped revenue growth.