PAL Holdings Inc., the publicly listed operator of flag carrier Philippine Airlines, saw profit fall in the first six months of 2016 as flight promos aimed at combating fierce competition cut into its bottom line.
In a stock exchange filing Monday, PAL Holdings said total comprehensive income fell 22.1 percent to P4.62 billion.
Revenues, which mainly come from the sale of tickets, was up 2.3 percent to P57.57 billion. PAL Holdings said operating expenses rose 5.8 percent to P53.42 billion as it increased flying operations.
The firm said higher revenues were realized during the period due to the weakening of the Philippine peso against the US dollar.
PAL Holdings also said this was because of lower “passenger and cargo revenues generated during the period as a result of the decrease in yields from passenger seat offerings and the positive effect of port strike in the United States to cargo revenues in 2015.”
For the April to June period, PAL Holdings said comprehensive income was also down 11.3 percent to P1.92 billion. Total revenues were up 0.5 percent to P28.45 billion.
PAL Holdings noted flying expenses, which fell 4.1 percent on lower fuel cost, offset the increase in total operating expenses for the first half of 2016.
For the period ending June 30, 2016, fuel expenses dropped by 14.3 percent as a result of the decline in average price per barrel of aviation fuel from $88.37 in 2015 to $63.38 in 2016.
Even with the challenging competitive landscape, PAL president Jaime Bautista said the firm hoped to end 2016 with a profit. Miguel R. Camus