Recovery of travel market allows CEB to trim losses

Cebu Air Inc., the operator of budget carrier Cebu Pacific (Ceb), trimmed its net loss in the first half thanks to the continued recovery of the travel market.

According to a disclosure to the stock exchange, Cebu Air reduced its net loss by 31.1 percent to P9.5 billion in January to June from P13.8 billion.

This, after recording a 250.3-percent surge in revenues to P20.7 billion from P5.9 billion on the back of significant increases in passenger volume, cargo services, and flight activities following the easing of travel restrictions.

Passenger revenues ballooned by 474.5 percent to P11.7 billion from P9.6 billion, as passenger volume also skyrocketed by 428.1 percent to 6.3 million from 1.2 million passengers.

Cargo revenues, meanwhile, also rose by 26.8 percent to P3.6 billion, while ancillary revenues surged by 414.2 percent to P5.4 billion.

Aside from its domestic network, Cebu Pacific has also started beefing up its international operations, expanding and reopening its flights to certain Asian destinations such as Singapore, Thailand, hanoi, Bali, and Taiwan.

The group reported that its expenses rose by 55.1 percent to P28.8 billion from P18.6 billion, mostly due to fuel costs, which are also directly affected by the weak peso.

“Amidst the risks posed by expensive jet fuel, peso depreciation and interest rate hikes, Cebu Air remains cautiously optimistic that we can turn the tide soon as domestic demand looks robust and international borders continue to reopen. We continue to stay true to our commitment of providing accessible air transport service for everyone.” said Cebu Pacific CFO Mark Cezar.

In July, the airline said it will continue to rack up losses this year, despite a steady flow in domestic revenues with Filipinos going on revenge travel mode.

Cezar made this confirmation to the Businessmirror, saying, “We also need more international passengers,” adding that the higher fuel surcharge “cannot cover for the increased fuel prices and the weaker peso.”

earlier, CEB announced that it already reached 100 percent of its pre-pandemic capacity, adding f light frequencies in key domestic destinations like Cebu and Caticlan (Boracay). So far, the carrier has reached 88 percent of its pre-pandemic capacity for international f lights, with Singapore, Dubai, and Bali as their most popular destinations.

Last year, CEB recorded some P25 billion in losses. Cezar said, “There’s dependency on fuel and forex, but yes, we’re still optimistic about registering a smaller loss [this year] than last year.”