HONG KONG: Hong Kong flag carrier Cathay Pacific on Wednesday announced a HK$1.26 billion ($161 million) net loss for 2017, marking the first back-to-back annual loss in its 71-year history. The company had been hit by intense competition from rival airlines and higher fuel prices, chairman John Slosar said. It was the biggest annual loss the company has seen in nine years and comes as lower-cost Chinese carriers eat into its market share. Companies such as China Eastern and China Southern Airlines are offering direct services to Europe and the United States from the mainland, while budget carriers have targeted regional travelers, undermining Cathay’s position. However, Slosar sounded a note of optimism for 2018 as Cathay saw improved premium class demand and a strong cargo business. The firm fared better in the second half of 2017, when it made gains of HK$792 million compared to a loss of HK$2.05 billion in the first six months of the year. Fuel hedging costs fell to HK$6.38 billion in 2017 from HK$8.45 billion the previous year Cathay’s loss of HK$575 million in 2016 was its first time in the red for eight years and prompted a management shake-up and promises to slash staff costs by 30 percent. It pledged to cut 600 staff including a quarter of its management as part of its biggest overhaul in two decades. Chief executive Rupert Hogg took over in May 2017, replacing Ivan Chu, who had been in the job for three years.