CATHAY PACIFIC – LUFHANSA FINANCIAL PERFORMANCES REPORT
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Date: 18 July 2014
Module Title: Managing Financial Resources
Module Code: XXXX
Assignment 1 part A:
CATHAY PACIFIC – LUFHANSA FINANCIAL PERFORMANCES REPORT
Executive summary
Purpose and method of this report
The purpose of this report is to analyze the financial statements of 2 comparable airlines and according to their financial performances decide on which should be more appropriate to invest in.
An analysis has been conducted over the annual reports of Cathay Pacific limited and Lufthansa 2012/2013.
The two Airlines, despite the fact that are very different in size, appear to be comparable for the following reasons:
1- Both of them are recognized as high end companies in their home markets
2- Operate in two crucial hubs for their continents
3- Have international networks and cover 5 continents
4- Passengers airlines is the first source of income
Findings and Conclusions
Lufthansa is recognized as European airline leader, it is a profitable company with safe turnovers. However Cathay Pacific is expanding with rapidity in a crucial nerve of developing Asia ( GDP Asia Pacific increase 4.4%, China 7.7%, Europe 0.3% ) and seems to control better its expenses. As a result Cathay will be the company suggested for the investment.
Conclusions
Lufthansa is the biggest European airline and 104 million passengers the past year. From its annual report and financial can be deducted that it is investing and borrowing in order to finance a new solid structural development ( Score ). It is financing in order to be more competitive in the future however is still facing some challenges as the exchange rate fluctuation from Euro and other currencies, the competitive pressure of middle-east state owned companies, low cost carriers in Europe and the cost of fuel prices.
The market however seems positive:
• first time in 5 year generating profits in European lines
• cargo achieve positive results
• catering service is
Date: 18 July 2014
Module Title: Managing Financial Resources
Module Code: XXXX
Assignment 1 part A:
CATHAY PACIFIC – LUFHANSA FINANCIAL PERFORMANCES REPORT
Executive summary
Purpose and method of this report
The purpose of this report is to analyze the financial statements of 2 comparable airlines and according to their financial performances decide on which should be more appropriate to invest in.
An analysis has been conducted over the annual reports of Cathay Pacific limited and Lufthansa 2012/2013.
The two Airlines, despite the fact that are very different in size, appear to be comparable for the following reasons:
1- Both of them are recognized as high end companies in their home markets
2- Operate in two crucial hubs for their continents
3- Have international networks and cover 5 continents
4- Passengers airlines is the first source of income
Findings and Conclusions
Lufthansa is recognized as European airline leader, it is a profitable company with safe turnovers. However Cathay Pacific is expanding with rapidity in a crucial nerve of developing Asia ( GDP Asia Pacific increase 4.4%, China 7.7%, Europe 0.3% ) and seems to control better its expenses. As a result Cathay will be the company suggested for the investment.
Conclusions
Lufthansa is the biggest European airline and 104 million passengers the past year. From its annual report and financial can be deducted that it is investing and borrowing in order to finance a new solid structural development ( Score ). It is financing in order to be more competitive in the future however is still facing some challenges as the exchange rate fluctuation from Euro and other currencies, the competitive pressure of middle-east state owned companies, low cost carriers in Europe and the cost of fuel prices.
The market however seems positive:
• first time in 5 year generating profits in European lines
• cargo achieve positive results
• catering service is
References: - Capa, centreforaviation.com downloaded 15 July 2014 - Chinaguide.com, statistics downloaded 15 July 2014