Cebu Pacific operator trims net loss in Q2

Cebu Air Inc., the operator of low cost carrier Cebu Pacific, saw its net loss reduced in the second quarter of 2022 amid eased travel restrictions during the period.

In a disclosure to the Philippine Stock Exchange on Thursday, Cebu Air reported a net loss of P1.9 billion, significantly narrower than the P6.5-billion net loss posted in the same period last year.

The budget carrier saw its revenue during the period grow by 337% to P13.97 billion from P3.2 billion in the same period in 2021, owing to more flights operated and more passengers flown as travel restrictions eased.

Cebu Air said revenue growth was driven primarily by strong recovery in the passenger and ancillary business which grew 644% and 572% year-on-year, respectively.

The company’s cargo business also sustained growth with a 15% increase to P1.7 billion year-on-year on the back of higher cargo volumes.

Cebu Air said seat load factor — percentage of available seating that has been filled — of 77% was 21 percentage points higher than last year’s 56%.

The improvement in load factor resulted from the network recovery driven by the domestic market where passengers flown increased 562% year-on-year while flights grew 350% year-on-year, the airline said.

Cebu Air added that the international network has also started to recover as travel requirements of other Southeast Asian countries such as Singapore and Thailand eased.

It also expanded its network as it resumed flights to Hanoi, Bali, and Taiwan in the second quarter.

Operating expenses totaled P16.8 billion, 86% higher year on year despite 323% more flights.

Fuel was the biggest contributor to expenses due to the steep hike in jet fuel prices, according to Cebu Air.

“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 chief finance officer Mark Cezar.—LDF, GMA News