Annual Results

[EFIS Check]

For all really bored with life, the CX annual business report is out.
http://downloads.cathaypacific.com/cx/investor/annualreports/2012_annual-report_en.pdf
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Pay
Pages 77, 78 break down the pay of the “dear leaders”. Of some note is the increase. I thought 2012 was not a good one but I suppose the increase is in line with (some form of) inflation ?! I notice all the time how the prices in HK go up but it is far worse than I thought ! All figures in Mio HK$
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CEO
2011 ​11.824
2012 ​15.742
+ 30% increase
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CFO
2011​ 3.602
2012​ 5.653
+ 55% increase
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Director Cargo
2011 7.900
2012 9.249
+ 15%
A bad year for cargo ?!
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Director Flight Ops
2011 6.214
2012 6.354
A bonus of 1.503 is not too bad.
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Even “the Tiger” gets 1.872 - and he left in 2011.
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Looks like a net profit fall of +80% is not so bad after all !
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Commitment to Staff
Page 10 – This surely is the best part !
CX’s commitments to their staff can be summarized as follows:
They have staff
They recruit pilots
They don’t recruit ground staff
They offer unpaid leave to cabin crew – a nice selfless act !
They have a cadet pilot program
They have a website to attract new pilots
They have an “ideas program” (???)
What is CX’s commitment to their passengers – that they take their cash ?!
I am sure every employee will be well pleased to hear about such a high level of commitment.
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Things you did not know about CX:
(inside the cover page)
CX is apparently flying to Rio, Lima, Santiago, Hawaii, Durban, Cape Town, Lisbon, Helsinki, etc.
The network looks almost like a third of that of Emirates !
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Looking forward to “The Management” response
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[boocs]

From the Annual Report, can someone clarify for me (not be an accounting type by a loooong shot) that CX currently has $56,399,000,000 HKD as cash in the bank. P.53 lists Capital and Reserves, but as I read further, there are other items that could be mis/interpreted as cash in the bank as well.

Many thanks,

b.

[Freehills]

No, capital & reserves is the accounting value of Cathay Pacific, as opposed to the market value (what the shares are worth)

Cash in the bank is note 26 (12,798m) However, liquid funds (note 21) includes cash in the bank, and CX holding things like US treasury bonds, and totals 24,182m HKD.

Not that surprising to have high cash levels as there are always big bills to pay. "Payables" (note 22, 17,460m) are invoices that Cathay has received, has to pay, but hasn't got round to it yet (companies normally give each other a month or two to pay)

[boocs]

Thanks Freehills!
b.

[cxorcist]

The one that sticks in my craw is the DFO. Will somebody please tell me one big decision that RH has made since becoming DFO? I cannot think of one thing that he has done other than occupy an office and watch the GMA run around like a madman hunting pilots and doctors. He made more than double the amount of any other pilot. What did he do to deserve it?

[Bye Bye Baby]

I like that JS's "contributions to retirement schemes" is about the same in 1 year as mine has been in a decade. As is the "bonus paid in to retirement scheme". So he got paid almost double the amount in 1 year that I have got over 10. Same team but very different dream.

[ASH1111]

Soooo...take the necessary educational, vocational, and career path steps to be a CEO instead of a pilot. Too much hating on folks for the paycheck. That's what his job pays, so go do the work to apply for it.

P.S. The envious ground handler and Cabin Crew member may feel the same about you, and your paycheck. To them, I say the same.

[cxorcist]

Agree. I don't have problem what JS, IC, or the illustrious NR made. The DFO? Well that is a different story. I know he does not deserve it.

[raven11]

The fuel letter from PE suggested that we as pilots have the most influence on cost savings derived from how we manage fuel burn....

But yet given the "one day" profit share payout last year, and zero payout this year, one can only infer that senior management don't share his view that pilots have any impact at all on the bottom line as the evidence suggests that all bonus payments went only to management.

So apparently, any future bonuses payed for any savings achieved will not be shared with pilots.....

Maybe PE should examine that.

[cxorcist]

Raven,

I had the exact same thoughts as I read PE's letter. I am not motivated to save fuel for the benefit of the company. They will not share those savings with us. So the only reason to be fussed with it is for the environment.

Why not incentivize crews to save fuel by having some sort of bonus system for those that shut down having burned less fuel than expected?

[China Flyer]

Why not incentivize crews to save fuel by having some sort of bonus system for those that shut down having burned less fuel than expected?

You would think that would be a good idea, but in a safety-driven environment, I'm not sure that's the best way to do it. Mind you, I don't have any alternative suggestions either!

PS No mention of cost index...

[Fly747]

Read what he said Jizz, he said burn less not take less, a big difference.
Nothing unsafe in trying to beat the Plog predicted burn.

[CX-HOR]

So Jizz,

I agree with the other posters about reading what was actually posted before flying off on a tangent.

You must be from the "entitled generation". Entitled to be paid more than other pilots flying the same type for less cash. AHK or JS haven't had any recent accident/incidents that I know of so why are YOU worth more to CX than one of those pilots?

With previous generation aircraft differences in pilot skills was shown in the accident/incident rates and so easy for skilled pilots to demand more moolah. But with newer/safer aircraft how do you demonstrate your value to the Company? Sure you might not have to rely on the "protections" built into these new aircraft that other pilots might to operate.

So in reality efficiency of operation from fuel saving to OTP to lack of need for additional training becomes the only real cost differentiator to justify getting paid more than the next guy.

How would you justify getting paid more than say the AHK wannabes asking some seriously simple questions on these forums? Is it only that English is your first language? Or perhaps daddy also worked for the same company?

[cxorcist]

Jizz,

No need to fly off the handle. I'm not advocating changing the way we operate (standards, stabilized approach, FDAP, etc.) and certainly not taking less fuel. Just incentivize the direct routing, getting levels, efficient descents, etc. Reference PE's letter for more details. If the 3rd floor can ask us to do all these things for free, they could certainly incentivize us to do them. Now tell me where I've gone wrong...

[Progress Wanchai]

cxorcist,

A decade ago when Korean decided to clean up its act the first thing it removed was incentive payments for fuel saving. It was discovered (and not surprisingly) that Korean never held due wx, never flew missed approaches and rarely diverted. Also hardly ever de-iced at remote bays. All these events cost the captains financially.

I dont think our management are playing with the full deck but thankfully they're not as thick as some who get on here.

"Incentivize direct routing etc..."
Seriously, you need to have a read through your COS and a few company manuals. Asking us to do things for free?? Where are you on the 25th of every month?? Dill Idiot hasn't asked us to do a thing that most of the boys and girls aren't already doing.

[MrClaus]

If you really want to know why this company made a loss then have a look at the debt equity ratio as opposed to previous reports. Cathay has doubled its debt equity ratio and loaded up on cheap debt. The increased financial charges for 2012 alone were enough to push the company into another manufactured loss......again (you can't use a 23% increase in maintenance charges 2 years in a row!).

Most of the debt is short term, unsecured bank loans that will mature in 3-5 years. I suspect this is what is paying for the shiny new A350s in the years to come. At the same time they are still selling the 'times are hard' story to the staff so as to reduce wage demand pressures. As mentioned the real story lies in the obscene increases in executive salaries. They have obviously made the board (ie Swire) happy with this annual report so look forward to another 'hard year' where they try more smoke and mirror tricks so as to create a 2013 loss.

[Brown Nose]

JS should be the highest paid in the company whether he deserves it or not, he is the CEO after all.

However, everyone in the company should get the same % payrise as him in a given year, right down to the mail boys

[raven11]

The point is that we as team-members in the venture called Cathay Pacific all have an impact on the bottom line, especially those of us at the pointy end who manage the $150 million US dollar man-made aluminum tube that we operate while carrying up to 400 passengers seven miles above the earth at speeds just shy of the speed of sound.

If my efforts culminated in a one day profit share payout last year, and zero days profit share this year, as compared to the undiminished bonuses paid to only a very small number of team members, pointing out that discrepancy does not mean I advocate diminishing the safety standards we currently operate under in order to increase my monetary return. Far from it.

The suggestion that we as line crew would lower our standard of safety to make an extra buck can be ascribed to any decision maker in our company who receives a share of the profit. It is a non-starter and insulting to say the least.

I suggest that our pilots are a cut above those employed at Lion. Our managers and our passengers expect no less.....

[Flap10]

JS should be the highest paid in the company


Why should that be??? Explain to me the rational that just because he is a CEO he should be the highest paid?? :\:\:\ You can fill that position by a number of gifted individuals for far less money.

It's exactly this logic of lets pay our CEOs ludicrous amounts of money that has gotten us into this global financial mess. There is never any accountability, loss or profit they still make millions on the backs of the employees. :yuk::yuk:

[main_dog]

P.S. The envious ground handler and Cabin Crew member may feel the same about you, and your paycheck. To them, I say the same.

However, everyone in the company should get the same % payrise as him in a given year, right down to the mail boys

Have to agree with Brown Nose... it's not the absolute size of their paycheck that bothers me: like ASH111 says, we applied for a pilot job rather than a management post, while a flight attendant applied for a cabin crew job not a pilot job (and to their credit our managers regularly manage a yearly profit, a bit of a rarity in this loss-making industry).

It's the difference in the relative rate of increase of these paychecks which is perhaps galling: the double-digit increase in remuneration for our leaders when compared to the low-single-digit increase for all other categories does get disheartening, especially as it happens year after year. Even more so when what increases we do get don't even keep up with inflation. :ouch:

One could almost believe that the increase in their remuneration is directly linked to keeping ours in check... :}

[monster330]

Raven11

Crap on will ya!

7 miles above the earth.... Ooooooh

$150M jets.........oooooooooh

Cut the malarkey and retire will ya

Your post is embarrassing.

[iceman50]

Monster330

Your post is embarrassing.

Unlike your post then!

[raven11]

Monster 330

I'll retire when I'm good and ready. In the mean time....

Grow up and offer something more mature or take your inferiority complex to other social media more appropriate to your adolescent writing skills.....and intelligence level.

"Will ya..."

[Steve the Pirate]

Raven, relax, it's a wind up - you old fart! :)

STP

[my oleo is extended]

I'm interested in Yeager's thoughts on this matter :E

[Busbert]

The point is that we as team-members in the venture called Cathay Pacific all have an impact on the bottom line, especially those of us at the pointy end who manage the $150 million US dollar man-made aluminum tube that we operate while carrying up to 400 passengers seven miles above the earth at speeds just shy of the speed of sound.


I think you should be rewarded for the fact that statistically you will be first to the scene of the accident. Take off is optional, landing is mandatory, and they haven't left one up there yet.

[White None]

Oleo chap, (too long/difficult)

I'm interested in Yeager's thoughts on this matter

I'm not..... anyone else?

[AnAmusedReader]

EFIS check wrote: "Of some note is the increase. I thought 2012 was not a good one but I suppose the increase is in line with (some form of) inflation ?"

The answer is the bonuses relate to the previous year, 2011.

The point remains though: percentage increases for the directors are far higher than the workers got.

[cxorcist]

So what is the profit sharing formula for the executives and directors?

[raven11]

STP

...a wind-up? You're joking right?

I recognized Monster330's post for what it was...a personal attach by a keyboard warrior hiding behind his anonymity. What did his childish comments contribute to the debate? Isn't it enough that the non-flying types denigrate and diminish what we do?

But thanks anyway, even as an "old fart" I can defend my self......I've been called worse things by better people.

[Progress Wanchai]

Because better people know you're worse?

[bogie30]

very good...:D

[raven11]

Now those are wind ups!!:ok: