PAL Holdings slumps to P7.3-B net loss in 2017
PAL Holdings, Inc. swung to a P7.3 billion net loss attributable to parent in 2017 from a P4.13 billion profit in the year prior, as higher fuel prices and ballooning aircraft and passenger expenses weighed on the bottom line.
In a regulatory filing, the parent company of Philippine Airlines said consolidated revenues rose 13.2% to P129.51 billion last year.
“The increase in revenues was attributable mainly to higher passenger revenues brought about by the growth in volume of passengers carried and number of flights mounted. During the year, new international points and city pairs were introduced,” PAL Holdings said.
In 2017, PAL introduced new flights between Clark and Seoul, Cebu and Chengdu, Kalibo and Chengdu, Kalibo and Guangzhou and Cebu and Bangkok, and launched daily service to Kuala Lumpur. For domestic flights, PAL introduced routes from Clark Airport in Pampanga, Cebu, and Davao. PAL carried 14.5 million passengers against 13.4 million in 2016.
However, the company’s consolidated expenses grew by 26.7% to P136 billion for the year ending December 31, 2017, from P107.3 billion during the same period in 2016.
“The main drivers for the growth are attributable to flying operations expenses, maintenance, passenger service, aircraft and traffic servicing, and reservation and sales,” PAL said.
Expenses from flying operations went up 31.7% to P67.3 billion in 2017, with the jet fuel costs accounting for more than half or P37.7 billion. PAL said jet fuel prices rose from an average of $75.59 per barrel for 2017 from $67.57 per barrel in 2016.
Maintenance expenses rose 23.5% to P15.7 billion, due to “higher aircraft, engine and component repair and maintenance costs incurred during the current period as a result of the additional aircraft deliveries and increase in utilization.”
Costs related to passenger services jumped 22% to P12.6 billion for 2017, as PAL saw an 8.3% increase in passenger traffic and 3.2% rise in number of flights operated. —