MacroAsia profit slips 18% in first half of 2018

MANILA, Philippines — MacroAsia Corp., the aviation-related services company of tycoon Lucio Tan, saw its earnings drop by nearly a fifth in the first half, but remained confident of a strong 2018 finish.

MacroAsia’s net income fell by 18 percent to P551 million in the first half from last year’s P673 million due mainly to one-off non-operational accounting provisions in 2018 pitted against one-off reversal of provisions for insurance items in 2017.

The firm’s core net income, however, rose six percent to P572 million during the period from P538 million last year, driven by a 36-percent growth in second quarter earnings.

“Despite the reported net income decreasing by 18 percent for the first six months compared to 2017 that benefitted from the accounting gain from the reversal of insurance provisions, the group is confident that it will still be able to reach its initial guidance of 20 percent organic growth for the year,” the company said.

“MacroAsia believes that it is still poised to grow its annual 2018 results substantially in the second half of 2018, as its ground handling company saw the servicing of eight new airline accounts in the first half, and is also starting its concessions in Terminal 2, Mactan Cebu as the terminal became operational this July,” it said.

MacroAsia’s first half revenue likewise soared by 16 percent year-on-year to P864 million as topline of the ground handling business and catering arm grew 40 percent and five percent, respectively.

The strong topline performance of both companies was attributed to the acquisition of new clients, general volume increases in airline traffic, and a stronger dollar exchange rate.

Unit MacroAsia Catering has added three new clients to its rosters in the first half and is set to inaugurate its new commissary for its non-airline subsidiary within the second half.

LTP, which is 49 percent owned by MacroAsia, is expected to significantly grow its line maintenance business due to the full takeover of line maintenance for PALExpress Airbus planes starting July, bringing the planes being maintained for the PAL group from 62 in the first half to about 77 by yearend.

LTP’s base maintenance business is also scheduled to do several A380 checks for the remainder of the year.