Tan’s MacroAsia switches tactics to soften blow from aviation woes
Taipan Lucio Tan’s MacroAsia Corp. is shifting gears during the COVID-19 pandemic as it scales back its core aviation services to focus on water distribution and even telecoms.
A major ground handling and aircraft maintenance provider, MacroAsia operates in sectors hammered by the global health crisis.
In its 2020 annual report, the company recorded a P1.8-billion net loss, reversing a P1.1-billion profit in 2019. Revenues last year fell 63 percent to P2.25 billion, the largest decline coming from in-flight catering and ground handling following the global downturn in aviation.
During the crisis, MacroAsia said it implemented a combination of cost-cutting and cash conservation measures.
This came alongside an “aggressive rightsizing program” that included reducing its workforce by 44 percent in 2020, the report showed.
While job cuts were implemented and airline clients delayed their maintenance programs during the pandemic, MacroAsia said it was “also focused on growing its non-airline related business.”
This includes three operating water companies in Boracay, Cavite and Nueva Vizcaya.
“It is expected that in 2021, the water business of MAC will grow significantly better than 2020,” the company said in its report.
The company is also looking into the telecommunications business via radio trunking, a more efficient and secure means of communications compared to conventional radio systems.
MacroAsia said it invested in digital radio trunking system in several airports using a frequency assigned “several years back.”
“With the impending completion of regulatory requirements and the commissioning of the network, this investment will be operational in the first half of 2021, opening new avenues for cost control and revenue growth,” MacroAsia said without providing added details.
MacroAsia said it would fund these new projects with its own cash or debts from partner banks within the year.
