PAL trims losses in Q1

MANILA, Philippines — Flag carrier Philippine Airlines (PAL) further trimmed its losses in the first quarter as it raked in a 7.2 percent rise in revenues.

In a financial report to the Philippine Stock Exchange, parent firm PAL Holdings Inc. said comprehensive loss in the first quarter amounted to P60.81 million, 69.8 percent lower than the P201.63 million in the same period last year.

Consolidated revenues for the first quarter of 2019 amounted to P39.27 billion, 7.2 percent higher than the P36.62 billion a year ago.

 “The P2.65 billion improvement in revenues was primarily due to the increase in number of passengers as a result of additional flight frequencies and introduction of new routes,” PAL said.

Meanwhile, total expenses for the quarter increased to P36.81 billion, 0.2 percent higher than the previous year’s P36.74 billion mainly on account of higher maintenance, aircraft and traffic servicing and reservation and sales.

“This was partly offset by the decrease in flying operations and passenger service expenses,” PAL Holdings said.

Flying operations expenses decreased by 3.4 percent from P19.82 billion to P19.15 billion in the same period in 2019 primarily due to the decrease in fuel expenses.

Fuel costs dropped by 10.2 percent in the period due to the decrease in average fuel price per barrel from $88.36 in 2018 to $85.04 in 2019, partially offset by the increase in fuel consumption as a consequence of increase in number of flights operated.

Passenger service expenses decreased by 6.4 percent or P218.27 million due to lower passenger food and cabin crew costs.

Maintenance expenses, on the other hand, increased 8.2 percent to P5.12 billion due to new aircraft deliveries which started during the second quarter of 2018.

PAL president and chief operating officer Jaime Bautista earlier told The STAR that the company’s target is to return to profitability this year.

The last time PAL was profitable was in 2016, despite net earnings falling by 39 percent year-on-year then.

For this year, PAL is counting on sustained strong passenger demand and hopefully continued stabilizing fuel prices for its bullish profit outlook.

PAL, the country’s only four-star global airline, is currently undertaking upgrades and expansion to achieve its goal of being a five-star carrier.