Cathay Pacific Airways, Hong Kong's dominant airline, said on Wednesday 2008 earnings will be disappointing due to weak revenue and losses on fuel hedging -- its second profit warning in about two months.

The airline said it expects to lose HKD$7.6 billion (USD$974 million) on fuel hedging, worse than the HKD$2.8 billion in estimated losses it revealed in November, when the airline also warned of potentially disappointing results.

Cathay said revenue has continued to weaken since November, with first and business-class traffic falling significantly and softness in the air cargo market from Hong Kong and mainland China.

It said the increase in unrealized mark-to-market fuel hedging losses was caused by the slide in oil prices in the final two months of the year.