PAL losses swell to P10.7 billion in Q1

MANILA, Philippines — Losses of Philippine Airlines (PAL) ballooned in the first quarter as the coronavirus disease 2019 (COVID-19) pandemic started to take a significant toll on its operations.

PAL Holdings Inc., the operator of the country’s flag carrier, said total comprehensive loss widened to P10.72 billion in January to March from only P60.81 million in the same period last year.

The group’s operations were severely affected by the worldwide travel restrictions due to the COVID-19 outbreak, PAL said.

“The COVID-19 outbreak has caused disruptions to businesses and economic activities, and its impact on businesses continues to evolve. Consequently, the group’s passenger operations have also been disrupted, resulting to suspension of its flights both for domestic and international routes,” PAL said.

Revenues declined by 18.3 percent to P32.07 billion as a result of a 21.4 percent drop in passenger revenues due to flight cancellations in March.

Consolidated operating expenses rose 5.2 percent to P38.63 billion, largely due to the increase in flying operations expenses, particularly fuel expenses as a result of hedging losses.

“The group’s performance was severely affected by the economic condition of the country. Nevertheless, the group is committed to keep the flag carrier continuously flying in the safest condition even in the midst of COVID-19 pandemic,” PAL said.

“The group will continue to assess any and all possibilities available to mitigate the increasing risks it is currently facing,” it said.

PAL president and chief operating officer Gilbert Santa Maria said last month the airline was not in immediate danger of bankruptcy, but could be forced to lay off more employees depending on how its recovery goes once commercial flights are allowed to resume.

He said a P15-billion infusion of tycoon Lucio Tan has allowed the airline to survive the crisis so far.

PAL has started operating on selected international and domestic routes this month after securing the go signal from the government.