PAL swings to net loss in first three quarters

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Philippine Airlines (PAL) posted a total comprehensive loss of P3.546 billion for the first nine months of 2017, a significant downturn from the P2.961 billion net income recognized in the same period of last year.

For the third quarter of 2017, the flag carrier reported a total comprehensive loss of P2.491 billion, 49.9% more than the loss of P1.661 billion in the same period last year.

Revenues, however, grew 15.6% to P98.633 billion in January-September 2017 from P85.354 billion in the first nine months of 2016. PAL, in a regulatory disclosure, said the increase was attributable to the growth in passenger and cargo traffic as well as ancillary revenues, resulting from additional flight frequencies and introduction of new routes.

Passenger revenues went up 14.7% to P81.964 billion from P71.469 billion, while revenues from its cargo operations jumped 23.5% to P6.099 billion from P4.938 billion previously.

The carrier’s total expenses for the first nine months of the year grew 27.3% over the previous year’s, primarily due to the increase in flight frequencies and introduction of new routes. The increase in expenses is attributable mainly to higher costs in flying operations, maintenance, aircraft and traffic servicing, passenger service, reservation and sales, and general and administrative services.

PAL reported a 38.9% decline in net income in 2016 to P3.945 billion from P6.460 billion recorded in 2015. The airline recently settled P6 billion in unpaid air navigational charges to the national government, which were incurred from 1970 to July 30, 2017.

Moving forward, the airline said it plans to acquire modern and technologically advanced aircraft, while refurbishing and reconfiguring the existing fleet in order to deliver added comfort and improve service offerings. The carrier aims to be the country’s full-service five-star airline in five years.

To reach this goal, it aims to implement flagship initiatives such as fleet modernization by acquiring six brand-new Airbus A3350s, which are set for delivery starting mid-2018, and reconfiguring eight mono-class Airbus A330s to tri-class layout.

At present, PAL has a total of 82 planes, made up of A320s, A321s, A330s, A340s, and B777s as well as Bombardier Q300s and Q400s.

The airline is also increasing its international and domestic routes and services.