Cebu Pacific parent erases losses on bigger demand for travel
MANILA -The operator of budget carrier Cebu Pacific registered profits in the January to September period given the robust demand for both domestic travel and international flights.
In a disclosure, Cebu Air Inc. reported that net income reached P5.03 billion at end-September, a turnaround from a net loss of P12.05 billion in the same period a year ago.
The Gokongwei-led airline grew its top line by 78.2 percent to P66.9 billion, driven by stronger operations with the resurgence of air travel.
In particular, passenger revenues more than doubled to P46.13 billion as passenger volume soared by 48.8 percent to 15.5 million. It also registered a passenger load factor of 84.4 percent, an improvement from 74.4 percent a year ago.
Passenger load factor measures the percentage of available seats vis-à-vis actual number of passengers. A higher figure means higher occupancy or more tickets sold.
Average fares increased by 37.9 percent to P2,970 amid bigger travel demand, especially for international routes.
READ: Gokongwei airline prepares aggressive hiring plan
Operation expenses up
The budget carrier incurred flying operation expenses of P25.57 billion, up by 30.7 percent from P19.56 billion in the previous year. Majority or 56 percent of the spending was accounted for by fuel consumption as Cebu Pacific handled more flights.
For the third quarter alone, net income was at P1.28 billion, which also reversed the net loss of P2.54 billion a year ago.
The airline said there was a “notable increase in travel demand in the third quarter, attributable to the change in school calendars, which shifted graduation and school breaks toward the months of June to August.”
READ: Cebu Pacific to buy 100-150 jets worth $12B in biggest aircraft deal in PH history
Cebu Pacific is in the process of acquiring 100 to 150 aircraft estimated to cost $12 billion in preparation for greater demand and the ongoing regional airport developments.
The first batch of jets is expected to arrive as early as 2027 while the rest is slated for delivery until 2035.
Its international network comprises 25 destinations, while its domestic operations cover 35 routes. Next month, the airline will start flying to Da Nang, Vietnam. INQ
