CATHAY Pacific Airways Ltd said its first-half profit surged to HK$6.84 billion (US$881 million) as passenger numbers recovered from the recession, and announced it would buy 30 Airbus jets.

The Hong Kong-based carrier, which also owns Dragonair, said the result compared to a profit of just HK$812 million in the first half of 2009. Revenue jumped nearly 34 percent to HK$41.3 billion.

The company said ticket sales for its premium cabins were lifted by a "sharp increase" in business travel originating in Hong Kong. Along with Dragonair, the two airlines carried 13 million passengers in the first six months of the year - an annual rise of 8.5 percent.

Cargo traffic also picked up, allowing the airline to bring back five cargo planes that were parked during last year's downturn by July. The two airlines delivered 872,000 metric tons of freight in the first half, a 24.4 percent increase from last year.

As it announced the strong results, Cathay Pacific said it has signed a letter of intent to buy 30 Airbus A350-900 planes, pledging a commitment fee of US$4.5 million for the US$7.82 billion purchase of long haul aircraft.

But the airline also warned about the risk of growing fuel costs, noting that it paid 51 percent more for fuel in the first half. The first-half fuel bill of HK$13.1 billion included HK$104 million in fuel-hedging losses.

"Our results would be adversely affected, and very quickly so, by a significant further increase in fuel prices or any return to the recessionary economic conditions of 2008 and much of 2009," said Chairman Christopher Pratt.

Unable to give shareholders a dividend last year, Cathay Pacific said it would issue an interim dividend of 33 Hong Kong cents per share.

The airline said the increase in direct flights between rivals in mainland China and Taiwan amid warming ties continued to hurt its Taiwan business.