PAL back in the black, books P1.5-B income in 2nd qtr

MANILA, Philippines - Philippine Airline’s parent firm PAL Holdings Inc. reported a net income of P1.49 billion in the second quarter of the year, reversing a net loss of P1.08 billion in the same quarter last year.

In a report to the Philippine Stock Exchange (PSE), PAL reported a 47.4 percent  increase in revenues to P27.3 billion from April to June this year compared to P18.52 billion in the same period last year as passenger revenues surged 51 percent while cargo revenues grew 33 percent.

Passenger revenues amounted to P16.33 billion in the second quarter this year or P4.92 billion higher than the P11.4 billion in the same quarter last year on the back of the launching of new international routes.

 “The increase was attributable mainly to the favorable passenger revenue performance during the quarter. This was brought about mainly by the introduction of new routes such as London, Abu Dhabi, Dammam, Riyadh, Canton, and Haneda, Japan,” PAL told the PSE.

The airline’s expenses increased 31 percent to P25.52 billion from P19.47 billion largely on account of higher expenses related to flying operations, aircraft and traffic servicing, passenger service, reservation and sales, general and administrative expenses.

Expenses from flying operations rose to P16.33 billion from P11.41 billion due to higher fuel consumption with the introduction of new long haul routes, the upward movement in fuel to $128.55 per barrel from $126.68 per barrel, higher aircraft lease charges with the acquisition of 16 Airbus aircraft and a Boeing aircraft, and higher cockpit crew cost due to more international flights.

On the other hand, maintenance costs fell 21.1 percent to P1.94 billion from P2.46 billion with the use of brand new and fuel efficient aircraft.

As a result, PAL recorded a comprehensive income of P1.44 billion in end-June from a comprehensive net loss of P499.8 million in end-June last year.

The change in the airline’s accounting period to calendar year ending Dec. 31 from fiscal year ending March 31 took effect this year.

The company posted a net income of P560.11 million for the six months ending June this year compared to a net loss of P1.08 billion for the three months ending March 31 last year.

Revenues for the period amounted to P41.01 billion compared to P18.52 billion during the three-month period last year while expenses reached P47.97 billion versus P19.47 billion.

In April 2012, SMC’s wholly-owned subsidiary San Miguel Equity Investments Inc. (SMEII) acquired a 49 percent equity interest in Trustmark Holdings Corp. for $500 million. Trustmark owns 97.71 percent of PAL Holdings which in turn owns 84.67 percent of PAL through PR Holdings Inc.

Ang, who is president and chief operation officer of both PAL and SMC, committed to bring the national flag carrier back on the black with an ambitious fleet renewal program aimed at acquiring 100 brand new aircraft with an initial order for 65 Airbus aircraft worth $9.5 billion.